Published on August 23rd, 2007 by Alan L Sklover
“Better a lean agreement than a fat lawsuit.”
- Yiddish Proverb
ACTUAL CASE HISTORY: It happens nearly every week. Last week it happened three times: one of our clients was invited – or required – to participate in “mediation” of a workplace dispute. And whenever that happens, it is inevitable that we are soon to be asked, “What is mediation all about?”
Sharon , 48, was a television-commercial producer for a leading advertising agency. She’d been with the firm for almost 18 years. For the last 7 years, she had been the lead producer for many commercials produced for a major client of the firm in the food products industry. The client loved working with Sharon , and the feeling was mutual. When a Senior Producer/Vice President position opened up, Sharon made a formal bid for promotion. Surprisingly, she was denied the promotion, and it was given to a younger woman, aged 32, with far less experience. Sharon was concerned that her age might have been the reason. She asked us what she should do.
We learned that Sharon’s employer was among an increasing number of employers that have a formal process that employees must use to resolve workplace disputes. In Sharon’s case, her employer’s Employee Handbook contained a section entitled “Dispute Resolution,” and in that section all employees were notified that, if they felt they had been treated wrongly, illegally or unfairly, they had to follow a three-step process: (a) first, they had to send a written note to Human Resources in which the dispute was described; (b) if that didn’t resolve things within thirty (30) days, employees had to participate in “mediation,” and (c) if that didn’t resolve things within sixty (60) additional days, only then (d) could employees sue in court.
Sharon did send a written note to HR describing her failure to be promoted, and the promotion of someone with far less qualifications, and without significant client support. In two weeks HR responded: the failure to promote Sharon was not, in its opinion, anything improper; in their words, “these things just happen.” Suffice it to say, Sharon did not find that to be a “resolution.” She then came to us to help with her mediation.
As required by the mediator, we prepared a five-page “mediation statement” describing Sharon’s complaint, her resultant damages, and her goals: (a) she wanted the promotion; (b) if she couldn’t get that, she wanted: (1) the raise she would have received had she been promoted; (2) a promise in writing to consider her for the next promotion; (3) an apology; (4) a letter confirming that she would not be retaliated against for raising this complaint; and (5) her legal fees reimbursed. Because the employer’s attorney told the mediator that she didn’t want us to see her mediation statement, we told the mediator that we wanted ours kept confidential, as well.
Three weeks later, we met with Sharon, the mediator, her employer’s HR representative, and her employer’s attorneys. First we all met together, then the HR representative and the employer’s legal counsel moved to another room. The mediator, a retired judge, engaged in a kind of “shuttle diplomacy,” moving from room to room and back again, both empathizing and trying to get us to sympathize, or at least understand, the employer’s viewpoint. No doubt, the retired judge was doing the same thing with them. At 1:00 pm , we took a 45-minute break for lunch, all together.
Over seven hours, we discussed, debated and sometimes heatedly argued the relative merits of Sharon’s “case,” and the relative advantages and disadvantages to both the employee and employer of resolving things that very day, as contrasted with being in court over the next year or two. We were surprised to hear that some of Sharon’s colleagues had voiced complaints about her, that she was seemingly “too forthcoming, too honest” with the clients, at times, it appeared, to the agency’s detriment. Little by little, small step by small step, ever-so-slightly, both sides agreed to compromise. At the end of the day, Sharon did not get her promotion, but got (i) four of her five requests, plus they agreed (ii) to move her to a more advantageous office, and (iii) permit her to work from home one day per week. HR refused to provide any “apology,” claiming that would be an admission of wrongdoing, which they steadfastly denied.
As I had hoped, both sides left a bit unhappy, but happy enough to be pleased with the result; that is, in actuality, the “goal” of a mediation. Best of all, we avoided the uncertainties, the cost, the disruption and the public “airing of laundry.”
LESSON TO LEARN: Mediation is becoming more and more common for one reason: it often works to resolve disputes without the substantial disadvantages of the litigation process. Overall, many people who have used the mediation process are pleased that they did so, especially employees, who have far less resources for a litigation than their employers do. As we explained to Sharon:
(a) Increasingly common: Mediation is becoming increasingly common, as more and more employers are using it. Many courts require that parties in litigation try to “mediate” their dispute before the Court will hear it. More state and federal administrative agencies, such as the federal Equal Employment Opportunity Commission (“EEOC”), are encouraging use of the mediation process, too.
(b) Entirely voluntary: Mediation is an entirely “voluntary” process, every single aspect of it. No one can “force” you to “mediate,” although it can be a required step in a larger resolution process. If you don’t like it, you can decline it. If you don’t like the way things are going in a mediation, you can simply stand up and walk out; my clients and I have done that many times, without any penalty. One thing you know: if a party wants to mediate a dispute, that party probably wants to settle it, quickly and confidentially.
(c) Common ground sought: The idea of mediation is simple: if two “sides” are both willing to engage in at least some compromise, with the help of a skilled mediator they might be able to find an acceptable “common ground” for settlement that they could not accomplish without a neutral third party.
(d) Mediators are a new kind of professional: Though many are retired judges or former lawyers, a mediator can have any training or background. Ideally, they have no interests with either side, no relations with either side, and are truly independent, honest and desirous of a fair process and end-product. (That being said, you can expect a certain desire by mediators to please the large companies and the large law firms, who provide them with most of their business income; it’s only natural.)
(e) The mediation process: While mediations can take any format, by far the most common format is this:
1. The parties are usually asked to sign an agreement with the mediator that says everything said in mediation will be held confidential, and provides for which side(s) will be paying the mediator fees. (In workplace mediations, the employer usually pays for all of the mediator’s fees, but does not often contribute to the fees of the employee’s attorney.)
2. The mediator usually asks the parties to prepare a confidential mediation statement that outlines their cases (or defenses), their support for their cases, and their goals. If both sides agree to exchange their mediation statements, they do; if either decides against that, neither side does so.
3. Both sides, their attorneys, and the mediator meet together in one room. Both sides are given an opportunity to make a statement in the presence of all parties. It is often a cathartic event for the employee, the first time they’ve had the opportunity to confront a representative of their employer, and “open up.”
4. One side will then move to another room for the rest of the day.
5. The mediator plays a game of “shuttle diplomacy,” emphasizing to each side the problems with their arguments, the strengths of the other side’s arguments, and the difficulties to be faced if mediation is not successful, and litigation ensues.
6. If the parties do not resolve their differences by the end of the day, the mediator commonly makes one last “stab” at a proposed compromise settlement. Some mediators will suggest going until resolution takes place; I’ve spent until 2:00 am mediating on more than one occasion. A good mediator will be eternally persistent, until a resolution is achieved, perhaps trying the next day, the next week, or even the next month to move things toward resolution.
7. If the parties achieve resolution, a settlement agreement will be drafted, and signed, right there and then, before either side leaves, because “untied knots tend to unravel.”
(f) Advantages: There are several advantages to mediation:
1. By its very nature, mediation helps both sides understand the other’s viewpoint.
2. The entire matter can be resolved in a single day.
3. As a result, there can be a significant savings in legal fees for both sides.
4. As a result, there can be far less disruption to the lives of both sides.
5. Most mediations are confidential; thus there is far less reputational risk for both sides.
6. Successful mediations end with a written agreement; thus they cannot be appealed from.
7. People find the mediation process – in which you speak up for yourself – to be cathartic.
(g) Disadvantages: There are disadvantages to engaging in a mediation, but they are few:
1. Any time you spend with your attorney may cost you money.
2. You may have to share in the fees of the mediator, which are usually between $600 to $1,000 for a day.
3. During your mediation, the other side may learn facts about your “case” you’d rather they not know, if you’re not careful.
4. In rare cases, things said in mediations can exacerbate any bad feelings the parties may have.
WHAT YOU CAN DO: If you have the opportunity to resolve a workplace dispute, consider trying it. In doing so, however, there are some things you’d be wise to do:
1. Don’t ignore legal deadlines for filing court or administrative complaints: Don’t believe that, since you are trying to resolve things amicably that your employer will “forgive” you if you fail to meet official deadlines for filing either court or administrative complaints. Go ahead and file if it’s necessary to meet an official deadline; you can always later agree to withdraw a filed complaint.
2. An employer’s agreement to mediate is a good sign; push further: We almost always see an employer’s agreement to mediate as a sign they want to settle. First, insist that they pay for the mediator’s fees, whether or not the case later settles. Next, ask that your employer agree to a base offer, that is, a minimum amount they will agree to pay; they may ask you to agree to a limit on the upside of what you’ll ask for. Such “high-low” agreements, by limiting the chasm between the parties, almost always lead to resolution. Third, ask that your employer agree to pay at least part of your legal fees. Perhaps as part of the later settlement. Don’t have high expectations on this point, but there’s nothing to lose in asking.
3. Don’t try to convince the mediator you’re right but, instead, that you’re determined: A mediator is not a judge or a jury; a mediator has no right to choose a winner, or any power to force a settlement. He or she may believe you’re right in what you say, but that is of no consequence. If he or she truly believes that you are prepared to go to court, then he or she may convince the other side of that, and that is all that really counts. Thus, “strength of resolve” is often more powerful in mediation than “strength of case.”
4. Likewise, don’t try to convince the mediator you are a “nice person”: Being liked by the mediator is a nice thing, but it won’t help you in the mediation. If anything, I suggest it might hurt you, especially if the mediator is afraid of your employer’s representative, and thus sees you as the person she can cajole.
5. Don’t let your guard down: If you have a secret witness, a strategy unexpected by your employer, or other information that is especially valuable to your case, don’t offer it up in mediation to the mediator or the other side unless truly necessary.
6. Try to get an especially good night sleep the night before: Not only can a mediation be an exhausting day, but it might well last into the night. I have prevailed at many mediations because I have the ability to ignore exhaustion. If, at 10 pm you are raring to continue, and they can’t see straight, you will in all probability prevail.
7. Don’t be surprised if the mediator disappears for an hour, or even two, at one time: It is not uncommon for a mediator to stay with one side for a long time, to try to “bond” with them, to test them, to convince them of their sincerity. I’ve heard from mediators I know that this is sometimes also a tactic: they might even go out for a walk for an hour to make both sides concerned about “what is taking so long?” While I have never been able to concentrate on other matters during a mediation, there’s nothing wrong with bringing a paper, magazine or busy work with you to avoid the jitters and keep your mind busy.
8. Expect the early discussions to move very slowly: Our experience is that, early on, neither the employee nor the employer wants to move much off their initial positions, and that early movement toward resolution is quite slow. If that happens to you, don’t get discouraged. Bear in mind that, faced with real deadlines (such as “I have to go and feed my children at 6:00 pm”), later movements in offers and counteroffers seem to go a lot faster. We strongly encourage continual improvements in offers and counteroffers, no matter how small, for movement toward resolution is always better than no movement at all. Remember that, so long as both sides remain in the building, there’s hope for a resolution.
9. Consider using “I will if they will”: This is a handy device to encourage movement toward resolution. Suppose no one has moved much, and you want to get some momentum going again. Consider saying, “I will lower my demand $20,000 if they will simultaneously increase their offer $20,000;” that way, no one “moves” first, and the movement toward resolution seems in equal steps, thus fairer. It’s a useful tool for your “mediation toolbox.”
10. If chances for success seem bleak, suggest “The Mediator’s Opinion”: If you’re at impasse, and things seem bleak, consider using “The Mediator’s Opinion.” This device is precisely what it sounds like: ask both sides to commit to listen carefully to what the mediator believes to be a fair, reasonable settlement, and the reasons he or she thinks so. If the mediator has established credibility with both sides, this sometimes can be the right tool for the job.
11. Bring with you a list of terms for the final settlement agreement: You should expect the other side to bring with them a settlement agreement, to be used in the event a settlement is reached. You should also expect that the settlement agreement they bring with them will favor their interests, and leave you unprotected. The items on your list of “necessary settlement agreement terms” should include:
a. Payment will be paid (or other steps taken) no later than [insert date.]
b. If payment is not made (or other steps taken) on time, the settlement is automatically null and void; that is, the settlement is conditioned on prompt payment (or other steps taken.)
c. You will not be required to take any further steps or provide any efforts in the future.
d. If your goals include a recommendation letter or apology, write down exactly what you want, and bring it with you; make it an exhibit.
e. Any release to be signed should be limited to this case, and not be a “general release” unless you are certain – absolutely – that no other obligations to you remain unfulfilled.
f. Every person or entity you release will release you to the same extent you release them.
g. If you have already instituted a law suit or arbitration, it will not be withdrawn until your check(s) clears.
h. If you have not brought a lawyer with you, then the settlement agreement must be conditioned on approval of your lawyer (within seven or ten days.)
i. Every page and exhibit must be initialed by both sides.
12. Keep perspective: this is a useful exercise, not a “make-or-break” contest: Some people get very emotional in mediations, because they see it as a kind of contest of wills; it is not. Instead, mediation is a useful exercise that can, if done right, get you what you want: reasonable resolution without the harmful side effects of litigation. Emotionality won’t get you that; smart mediation will.
You should expect that, at some time in the future, you will be asked to mediate a dispute, whether or not related to your employment. Consider it an opportunity to get a fair measure of fair treatment, without having to go to court. But be smart in how you handle your mediation.
SkloverWorkingWisdom™ emphasizes smart negotiating – and navigating – for yourself at work. If you feel you’ve been shortchanged or treated improperly, whether it regards a bonus, promotion, discriminatory treatment, or otherwise, don’t be afraid to move forward with a complaint and efforts to resolve it. There’s problems in every aspect of life. Intelligence in resolving them may make or break your career. Gaining maximum rewards without unnecessary risks is what business is all about. But it takes more than luck to make that happen. It takes forethought, care and prudence, the essential ingredients in good negotiating.
Always be proactive. Always be creative. Always be persistent. Always be aware. And always do what you can to achieve for yourself, your family, and your career. Take all available steps to increase and secure employment “rewards” and eliminate or reduce employment “risks.” That’s what SkloverWorkingWisdom™ is all about.
A note about our Actual Case Histories: In order to preserve client confidences, and protect client identities, we alter certain facts, including the name, age, gender, position, date, geographical location, and industry of our clients. The essential facts, the point illustrated and the lesson to be learned, remain actual.
Please Note: This Newsletter is not legal advice, but only an effort to provide generalized information about important topics related to employment and the law. Legal advice can only be rendered after formal retention of counsel, and must take into account the facts and circumstances of a particular case. Those in need of legal advice, counsel or representation should retain competent legal counsel licensed to practice law in their locale.