Choosing Mediation to Resolve Workplace Disputes

by Ericka B. Gray, CMDR Panel Mediator and Samantha Halem, Esq.

Conflicts in the workplace cost employers millions of dollars each year in lost productivity and lawsuits. Conflicts in the workplace can also cause less quantifiable problems such as decreased morale, increased gossip, and a polarized workforce.

Whatever your situation, whether you are trying to resolve a lawsuit efficiently without incurring substantial legal fees or losing valuable manpower hours or whether you are trying to work out an ongoing difficult relationship between co-workers or management and employees, mediation can provide you with a low cost, efficient, satisfactory resolution tailored to each parties’ respective needs.

The typical alternative to mediation – litigation – is extremely expensive. It is expensive not only in the classic sense of incurring legal fees, with the hourly rates of attorneys growing exponentially each year, but in less quantifiable ways as well. As anyone who has ever been through litigation knows, the amount of time and energy both parties will have to expend simply participating in the litigation process is considerable. Discovery alone with depositions, interrogatories, and document requests is a substantial drain, both financially and emotionally on both employers and employees alike. And this is before you even begin the long process of proceeding to trial.

More and more, employers and employees are turning to mediation to resolve their workplace disputes. They are doing so because mediation provides a confidential forum where the parties can resolve their disputes without incurring the costs discussed above. Also, parties can, if they so choose, maintain and even improve their ongoing relationship through the mediation process – something that is extremely rare after litigation.

Mediation offers both parties:

• Reduced Costs. It reduces litigation costs, lost productivity costs, as well as other less quantifiable costs such as decreased morale. After a case has been successfully mediated, both parties can return to more profitable activates. While it is impossible to predict exactly how much a given case will cost to litigate to completion, both parties will inevitably spend tens of thousands of dollars, with some relatively straight forward discrimination cases costing hundreds of thousands dollars to litigate. Moreover, employers who litigate to completion and lose are in many employment cases liable for the other side’s attorneys’ fees as well.
• Confidentiality. Mediation is a confidential process, unlike court proceedings and administrative agency records which are typically public;
• Decreased emotional trauma. Both parties often report feeling that their concerns have been recognized and that the mediation process has empowered them in that they are taking control of their own destiny rather than leaving it in the hands of a judge or jury.
• Greater flexibility in the timing, scope and procedural format. Not only is our legal system extremely slow moving with cases typically taking two to four years to proceed to trial – but with all its procedural rules it can be quite limiting. Mediation permits the parties to resolve their dispute quickly and in the manner in which they desire. Additionally, while courts can only hear claims based on violations of the law, a mediator can help the parties resolve disputes which, although not legally cognizable, are disrupting productivity in the workplace. Simple miscommunications and personality and style conflicts often lie at the root of many workplace disputes.
• Increased creativity in the remedies. Courts are limited in what they can order companies and individuals to do. There are remedies that parties may desire that cannot come out of a court proceeding. For example, an employee may find that an agreement to give a good recommendation goes a long way to meet their concerns while an employer may be more willing to settle with a confidentiality agreement regarding the outcome.
• Certainty. No one can accurately predict how a judge or jury might rule in a given case. A mediated settlement avoids the uncertainty of litigation and eliminates the risk of a jury or other decision-maker randomly and haphazardly deciding the case.
• Completion. Even if you prevail at trial, the other side can still appeal and drag out the process even longer. A successful mediation brings both sides the piece of mind of knowing that the dispute has been resolved.

The advantages of mediation versus litigation are easily apparent from the following two scenarios which started with the same controversy and resulted in two widely divergent outcomes.

THE STORY
Sarah and Connie worked together for more than five years and often ate lunch together. During the past year, Connie was promoted to become Sarah’s supervisor. Within a short amount of time, Sarah began to believe that Connie was favoring others in work assignments and singling her out for criticism. Connie would no longer go to lunch with Sarah and made a number of negative comments about her work in front of other team members. The relationship became strained and Sarah began to look elsewhere in the company for a position.

Eventually, after receiving her first below average performance review ever, Sarah went to Human Resources. There she alleged that Connie was discriminating against her because of her age. Sarah noted that Connie seemed to favor younger employees with the choice assignments and had hired a number of younger workers to fill open positions.

The human resources representative approached Connie with the accusation. Connie became extremely upset, denied all of the allegations, and demanded that the HR representative fire Sarah.

MEDIATION SCENARIO
AA mediator was called in to assess and intervene in the conflict. During the mediation process, which was kept confidential from HR by agreement of all, both Connie and Sarah began to understand each other’s perceptions. Connie believed that, when she became supervisor, she had to bend over backwards to not show favoritism to her friend, Sarah. Sarah was able to explain the effect that had on her. As to the age discrimination charge, Connie explained that all of the applicants for the open positions, which were entry level, had been relatively young. She asked Sarah for ideas to attract a greater diversity of applicants for these positions.

Both wanted to return to the friendly relationship they had prior to Connie’s promotion, and they wanted everyone to be fairly treated. Sarah wanted her performance review changed and Connie admitted that she probably evaluated Sarah with a tougher standard than she did others. Both wanted Connie to become a better supervisor.

One week after Sarah approached the HR representative, the mediation ended with a mutual apology and a plan of action for the future. This plan included individual coaching and courses on effective management for Connie, a brief training for the department in conflict management skills, as well as identification of internal resources that each could use should another situation arise. Connie and Sarah both agreed that Sarah’s performance had been lower than expected with Sarah having become less committed to her job due to the problems they were experiencing. Both agreed on a plan of action for more equitable assignments and an updated performance review in 3 months. On follow-up, the situation was much improved and Sarah and Connie had started to eat lunch together again.

Time spent: 5 hours of assessment and mediation and _ hour of follow-up.

Cost to the company: Less than $1,500

LITIGATION SCENARIO
Sarah filed a claim of age discrimination with the EEOC and an investigation began. Sarah hired a lawyer who decided to remove the case from the EEOC to court.

Soon after this, Sarah quit her job due to the stress. She was out of work for several months before finding a comparable job.

After the case was filed with the court, the company hired a lawyer to defend the claim. After many months of discovery, where many employees were deposed and the company’s human resources department and managers expended countless hours searching for documents in response to document requests and answering written interrogatories, the company’s attorney drafted a summary judgment motion. After waiting several months for a hearing and even more time for a decision, the motion was denied and the case was scheduled for trial. Over two years after the case was filed, the case was finally scheduled for trial. Several executives as well as Sarah’s co-workers were called to testify. The company’s hiring records, its policies and procedures were all placed into evidence. Additionally, because Sarah claimed she had suffered emotional distress, Sarah’s psychiatrist was called to testify about her emotional health. After a somewhat lengthy trial, the jury returned a verdict on behalf of the employer. Citing a mistake in the judge’s instructions to the jury, Sarah’s attorney then appealed the decision. More than four years after the case was filed, the appeals court affirmed the jury’s verdict.

Time spent: Hundreds of hours.

Monetary cost to Sarah: Three months of lost wages and tens of thousands in legal fees.

Cost to Company: Hundreds of thousands in legal fees and costs, significant losses in productivity due to allocation of resources to defend the case, and significant negative publicity.

How to Determine If Mediation is For You
When a conflict situation arises in the workplace that can derail relationships, decrease productivity, and potentially result in litigation, mediation should be considered. Mediation is private, confidential, and cost effective. A professional mediator from outside of the company can provide an impartial problem solving process tailored to the company’s and the individual’s needs.
All of our employment mediators are both well versed in employment law and trained mediators. Amongst our mediators we have experienced employment attorneys, psychologists, and trained human resource professionals.
If you would like further information about whether mediation is right for you please contact CMDR at 781-239-1600.