By Kristofer S. Michaud
Dispute Resolution Systems Design and Implementation in a Corporate Setting
Increasingly, corporations recognize the value of a Program for managing workplace conflict that precludes litigation. These systems are designed by trained ADR consultants retained by the company on a contract basis. In order to implement such a Program, there must first be broad “buy-in” from all segments of labor and management. Design consultants must therefore identify stakeholders. For a typical company, these will include management, the union, human resources, accounting, marketing, the in-house and outside legal teams, and the Board of Directors. A permanent Ombudsperson with perceived neutrality will act as Program director after the consultants leave.
Assembling the Team
The first stage is assembling the team. Each stakeholder group appoints a “Champion” to join the team along with the Ombudsperson. Management requires stakeholder groups to give full support to their Champion, who will be trusted to be forthcoming with opinions (without threat of retaliation) and to devote time and energy to the needs assessment and Program development portions of the process.
At the second stage, needs assessment, Champions will meet daily for four weeks to review past and present conflicts and how they’re resolved under the current system, list the outcome of conflicts and their effects on the company, and estimate the monetary cost in terms of lost work or opportunities, legal fees, and settlement fees.
Guided by the consultants, Champions should brainstorm to determine the underlying structural problem, the desired outcome for each conflict type, what is preventing that outcome, and the criteria for determining Program success or failure. Champions should prepare a general questionnaire (available on paper and online) and ask 10-20 members of their stakeholder group to complete it. The questionnaire should obtain stakeholders’ opinions about the company’s current system and what they would like to see in a future process. The consultants should have already obtained and pre-customized software for collecting and interpreting the data.
The third stage, content generation, takes about five weeks. The consultants spend the first week analyzing and interpreting the data gleaned from the questionnaire and Champions’ costs and problems assessment. The consultants should then take two weeks to prepare a report, including a budget and timeline, process structure and flow map, party responsibilities, core values (including non-retaliation, third-party neutrality and confidentiality) and draft literature and legal forms (paper and digital) for facilitation, mediation, arbitration and evaluating the outcome of each stage. The final two weeks will be used to obtain stakeholder approval of the conditional plan – each Champion will be responsible for vetting the process plan with their group and reporting recommended changes. The design team will incorporate realistic changes, defend important elements, and resubmit the process plan for stakeholder approval.
The Board and management are given no priority in the vetting process – they are just as important as any other stakeholder body. If one stakeholder group is holding up approval and their Champion and the consultants can’t work out the problem, the consultants will schedule a meeting with all interested members of the stakeholder group and attempt to fix the problem.
The Pilot Program
To limit hesitation at this stage, all stakeholder groups should understand that the conditional Program plan will first be “rolled out” in a Pilot Program limited to two branches of the company. To ensure that the full range of conflicts are represented, the two branches should be chosen because they have a level of conflict which is representative of the company as a whole.
The Pilot Program should be “rolled out” for ninety days. Members of the two branches chosen for the Pilot Program who want immediate relief during the Pilot Program must sign, as a condition of participation, contracts by which they agree to be bound by any voluntary agreements they enter into, or by the results of binding arbitration if the case reaches that level. If they are not prepared to be “guinea pigs” for the Pilot, they should withhold their grievance until the general rollout.
At the conclusion of every stage in the Pilot, participants will fill out a stage-specific survey to gauge their level of satisfaction with the process and the results. The data produced by the survey will be analyzed by the Ombudsperson and the consultants, who will also be present at every stage of the Pilot (including Mediation and Arbitration) as silent observers to ensure that it is running smoothly. At the conclusion of the Pilot, the Ombudsperson and the consultants will compare notes and prepare a report for the Champions including areas of concern and recommendations for modifications. The Champions will review the report and make recommendations for changes before it is edited and presented to stakeholders. Stakeholders will be asked to review the report and its recommended changes and communicate their opinions to their Champion. Champions will meet privately with the Ombudsperson and consultants and voice the concerns of their constituency. The committee will prepare a third draft of the report and recommendations and ask the stakeholders to vote on implementation.
If the vote passes, the consultants will leave, leaving implementation to the Ombudsperson. If the vote does not pass, the consultants may hold a meeting with each stakeholder group and attempt to address each group’s concerns in a fourth draft before leaving. If the Program plan does not pass at this point, it will be up to management whether they want to make the necessary changes themselves or hire a new team of consultants to develop (or replace) the Program. From the time the Pilot is complete to the time the consultants leave will be between three and four weeks, depending on the number of drafts they are asked to prepare.
The Final Program
The Final Program usually consists of a general-purpose anonymous hotline (to be gradually phased out as employees lose their fear of reprisal) and four main stages: Open Door, Facilitation, Mediation, and Arbitration. The early, low-cost stages focus on interests while the later, higher-cost stages focus on rights and power. Participants will fill out an exit survey concerning satisfaction with the process and the outcome at the conclusion of all stages (including the hot line stage – by touch tone), with the data being inputted into the specialty software and analyzed by the consultants during the pilot Program and by the Ombudsperson thereafter.
Open Door will have multiple entry points for maximum access: the employee books an appointment using the company intranet or a paper form, in which he or she states the grievance in one paragraph and lists no fewer than three possible solutions. The employee may elect to speak with his or her supervisor directly, or ask HR or the Ombudsperson to hear the employee’s story and intervene. In other words, it’s either a single meeting between the employee and his or her supervisor, or a series of meetings with the Ombudsperson or the HR representative acting as a go-between.
Regardless of the format, the employee and the supervisor should be allowed every opportunity to vent their emotions to each other or to the go-between. This practice conserves resources in the long run, while reducing workplace stress. The parties are instructed to focus on their interests, not their rights or their power, during this stage. At the conclusion of Open Door, both sides will fill out a stage-specific survey related to their satisfaction with both process and result. The data is forwarded to the consultants (during the Pilot) or the Ombudsperson (after the rollout).
If the problem is solved to the employee’s satisfaction by the supervisor (either alone or in consultation with HR or the Ombudsperson), the process is complete. If not, it moves on to a Facilitated Negotiation between the parties affected (employee-employee or employee-management). The Ombudsperson is the Facilitator, with the focus still on interests and not rights. During the Pilot, the Ombudsperson is shadowed by a consultant and they meet privately and analyze the outcome together.
Prior to commencement of Facilitated Negotiation, however, the Ombudsperson must determine if Open Door has been tried properly, and determine why it failed. If this stage was incorrectly or unfairly implemented, the Ombudsperson may counsel parties to “loop back” and try again, incorporating recommended changes before returning to facilitated negotiation. Then, if the problem is resolved to their satisfaction, the process is completed. If not, the process moves on to an outside Mediator within 40 days from the day the employee files the appropriate paperwork with the Ombudsperson.
The mediator is a third-party neutral chosen by the employee from a list maintained by the employer. Half the costs of mediation are provided to the employee by the employer, so the employee may write a personal check to the mediator and appear to be paying half the bill, thus obviating any concerns about mediator neutrality. The other half is to be paid by the company directly. The employee is allowed to bring a lawyer if they wish, but must bear the cost themselves. The employer will agree not to bring a lawyer to the mediation unless the employee brings theirs, but reserves the right to consult with counsel and upper management regarding settlement parameters before mediation. The company representative must have settlement authority, as must the employee. Both parties and their attorneys must agree that the emphasis should be on interests. References to legal rights are permitted in order to predict outcomes at arbitration, but threats or references to power are strictly forbidden.
At the conclusion of mediation, the company’s representative and the employee fill out an exit survey. If a voluntary settlement is reached, the process is over. If a settlement is not reached, the participants may, if both sides approve, ask the mediator to give his or her reasoned opinion as to what the likely result of binding arbitration would be. The parties may then decide whether to extend the mediation for another hour at the company’s expense. If a voluntary settlement is reached, the process is over. If not, the parties “loop back” and have private meetings with the Ombudsperson to discuss the outcome and the perceived barriers to a settlement. The Ombudsperson will again attempt a facilitated negotiation. Regardless of outcome, the parties fill out a stage-appropriate survey upon completion. If mediation is unsuccessful, the Ombudsperson refers the matter to a third-party neutral arbitrator for mandatory binding arbitration.
The arbitrator must be available within two months of the employee’s filing of the paperwork. Both parties must have legal representation for this stage, and the form (paper or intranet) will require the name of the employee’s chosen attorney. Provided he or she has followed the process exactly, company will pay the employee’s legal fees up to $2,000. The arbitrator is chosen from an American Arbitration Association (AAA) list of retired Judges or professional neutrals. The names are struck off the list, one at a time, with each party alternating with the other until a final arbitrator remains. Half the costs of arbitration are provided to the employee by the employer, so the employee may write a personal check to the AAA and appear to be paying half the bill, thus obviating concerns of mediator neutrality. The other half is to be paid by the company directly.
Both sides understand that the arbitrator’s decision is final and binding, and will be determined with reference to the legal rights of each. Evidence, depositions, and witnesses may be used in accordance with the rule of the AAA. This is the final, most costly, and least interest-based stage in the Program and is to be used only as a last resort when all other lower-cost, interest-based vehicles have been exhausted.
Workplace conflict is inevitable. Acknowledging this simple truth by investing in a comprehensive Conflict Management Program, employers will conserve resources that would otherwise be squandered on litigation, and preserve control of the problem. More importantly, they will also maintain a positive PR climate and increase employee satisfaction and productivity.
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