Magazine article The CPA Journal

Resolving Workplace Disputes through Mediation

Magazine article The CPA Journal

Resolving Workplace Disputes through Mediation

Article excerpt

Increasingly, employers and employees face workplace disputes involving alleged wrongful termination, sexual harassment, or discrimination based on race, color, religion, sex, national origin, age, and disability. To resolve these disputes in a fair, private, and cost-effective manner, more companies are turning to mediation, arbitration, and the full range of out-of-court settlement procedures by incorporating those procedures into their employment contracts, personnel manuals, and employee handbooks.

The Growth of ADR

Nearly 500 large corporations, representing approximately 5 million employees worldwide, have implemented alternative dispute resolution (ADR) programs that require the administrative services of the American Arbitration Association (AAA), and that number is expected to grow exponentially in the coming years. During the past five years, the AAA has witnessed a surge in the number of employment ADR case filings: 1,973 in 1999, up from 575 in 1994. The AAA has a roster of "client proven" mediators with significant experience and high success rates, with 85-90% of disputes reaching settlement.

An Effecfive Option

A recent survey of Fortune 1000 general counsel and chief litigators conducted by PricewaterhouseCoopers and Cornell University revealed that 87% had used mediation at least once in the past three years and nearly 79% had used mediation to resolve employment disputes. Eighty percent of the companies reported that mediation saved time, 89% said it saved money, and 83% agreed that mediation allowed parties to resolve the disputes themselves.

Most companies' ADR programs include internal procedures, such as peer review and internal mediation, as well as external procedures including fact-finding, mediation, and arbitration, which have proved to be fair and cost-effective ways to resolve workplace disputes privately.

For example, an employment lawsuit can cost approximately $30,000-50,000 depending on the complexity of the issues and can often last several years with multiple appeals. By comparison, using a mediator-an impartial individual with whom the parties discuss their dispute and who assists them in reaching a settlement-generally costs $150-250 per hour, split equally by the parties. The mediator may suggest ways of resolving the dispute but cannot impose a settlement on the parties. Because most employment matters can be resolved in one mediation session, the average cost might be only $600-1,000 per party, plus attorney's fees. …

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