My role as a “neutral”, to use the official jargon, necessitates that I am balanced in order to resolve conflict in the workplace and elsewhere. Some may joke that I am far from balanced, however, I take pride in my ability to be balanced when it comes to the subject of mediation or other forms of alternative dispute resolution in the workplace. The simple truth is this: Mediation works. It saves an organization time and money, and it is not something that should only happen when a formal complaint or lawsuit has been filed. Indeed, the closer to the origin of the conflict or dispute matters can be addressed, the higher chances there are to save both time and money.
The cost of conflict to an organization is high. Defending an employment-related lawsuit can easily approach $100,000 in legal costs alone. While employment practices coverage is fairly common these days, many cases (an estimated 81% by some sources) result in no payment by the insurance carrier. In other words, it is the EMPLOYERS deductible/retention money that is the first to go towards resolution or defense costs. The time spent by HR and other upper management can be staggering and have significant impact on the company. The average duration of an employment matter has been estimated to be 275 days.
The good news is that the vast majority of organizations recognize the cost-control effectiveness of alternative dispute resolution – a number on the rise since 1997, according to a study by Cornell University and Price Waterhouse. Nearly 90% of organizations responding to the 1997 study reported having used mediation as a means of resolving conflict in the prior three years. In addition to saving time and money, organizations have learned that allowing parties to resolve disputes themselves, with the assistance of a mediator, preserves working relationships, results in more satisfactory settlements, and was all-in-all a more satisfactory process.
Trained HR professionals can and should mediate disputes in the workplace, particularly those involving: personality conflicts, poor communication, strong emotions, misunderstandings, employee leave, benefits and pay are at issue. As always, however, if you are in doubt about you or your organization’s ability to mediate a particular conflict at hand, I urge you to seek the advice of your organization’s employment attorney.
When is it risky for the mediation to be handled by internal HR professionals? Because mediation is a voluntary process between the participants, when one participant refuses to allow HR to mediate, then it is time to see if an outside mediator would be a viable alternative. Another situation would be when HR cannot be balanced, or neutral, due to an obvious conflict of interest, or when HR’s impartiality is called into question on the particular matter at issue. Perhaps most importantly are those situations which have triggered the organization’s legal duty to investigate, or when the complaint/dispute is between the employee and the organization. In those situations, the organization is better off enlisting the services of an outside neutral mediator to work towards an amicable resolution.
Please feel free to contact me for further questions or discussion to learn how mediation can benefit your organization – saving your organization both time and money.