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It will be tinged with tristesse<\/em> on this occasion, however, since it will be the first time that the late Colin Wall, co-President and co-Founder, will not be with us. \u00a0By way of both honoring and exemplifying Colin’s devotion to sharing insights on mediation, the program designers have asked various speakers to contribute a paper for inclusion in a volume to be published in Colin’s honor, proceeds to go to his designated charity. \u00a0My topic is systems design for employment dispute resolution, and the article follows.<\/p>\n Designing Employment Dispute Management Systems<\/strong><\/p>\n Peter Phillips[1]<\/strong><\/a><\/strong><\/p>\n <\/u>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 In 2002, CPR Institute for Dispute Resolution[2]<\/a> published a compendium of 20 American employers\u2019 internal workplace dispute programs (the \u201cCompendium\u201d).[3]<\/a>\u00a0 The Compendium also included a comparative analysis of certain attributes of these programs,[4]<\/a> as well as interviews with six program designers and administrators.[5]<\/a><\/p>\n This article summarizes the findings of this study. Some of the concerns addressed by the internal programs are unique to the American context, particularly its regulatory and statutory environment concerning workplace rights and regulations.\u00a0 The overall approach reflected in these programs may nevertheless be of interest to students of workplace dispute resolution in other countries.<\/p>\n Why do companies adopt internal employment dispute systems?\u00a0 <\/strong><\/p>\n How do they measure whether the systems are successful?<\/strong><\/p>\n \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The impetus for most employment dispute resolution programs is usually managerial, and only secondarily legal.[6]<\/a> \u00a0Though many companies are prompted to create employment dispute programs because of an adverse judicial ruling involving a class of employees, [7]<\/a> a systematic managerial approach to workplace conflicts, clearly articulated and neutrally applied, lends consistency and manageability to the workplace.\u00a0 It assists in identifying flaws (including supervisory weaknesses) in the workplace that might otherwise undermine employee confidence and morale.\u00a0 It discourages intuitive, retaliatory, or vituperative managerial response to employee behavior.\u00a0 Corporate policies and interests, rather than individual supervisors\u2019 predispositions, drive company practices in the workplace.<\/p>\n \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Additionally, there are the benefits of preventive legal exposure.\u00a0 Managerial efforts to identify conditions or behaviors that might ripen into a legally cognizable cause of action, and to create nonlitigious avenues of redress, are clearly economically beneficial.[8]<\/a>\u00a0 Thus, well-planned and properly administered employment dispute management programs are not only managerially rational, but legally prudent.<\/p>\n The managerial goals of a dispute management program require the adoption of appropriate metrics.\u00a0 That is, companies measure success in this area the same way they measure the success of any organizational system or policy \u2013 by a metric chosen for that purpose.\u00a0 The effectiveness of employment dispute management programs might be measured by any of the following criteria:<\/p>\n These metrics are merely indicative.\u00a0 Each employer may adopt measurements that suit its management goals.[11]<\/a>\u00a0 The main point is that setting metrics to determine the effectiveness of any program is as important as creating the program itself.<\/p>\n Structural overview<\/strong><\/p>\n \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Almost all of the programs in the Compendium were designed with sequential and progressive phases, or steps.\u00a0 Classically, the first step was consultative and informal; the second step was professionally facilitated formal negotiation (such as mediation), and the third step was adjudicative, either public (litigation) or private (arbitration).<\/p>\n Distinctions among the programs were variations on either the details of these processes or their sequence.\u00a0 Some companies allowed mediation without the requirement of prior consultation.\u00a0 Some companies made mediation optional for employees but, once selected, mandatory for supervisors.\u00a0 Some used Human Relation officers as the first consultative step; others had peer review systems or methods to consult with management other than one\u2019s immediate supervisor.\u00a0 In some programs arbitration was binding on both parties; in others it was binding on the company but optionally binding on the employee.<\/p>\n Some companies required employees to use the program; others simply offered it.\u00a0 One company encouraged employees to seek legal advice before accepting a proposal in settlement, and even offered to pay towards the employee\u2019s legal costs for this purpose.\u00a0 One company had no requirement of sequential use of its steps, and offered four rather than three: an \u201cOpen Door\u201d or \u201cHot Line\u201d option, an \u201cInternal Conference\u201d option, a \u201cMediation Option,\u201d and an \u201cArbitration Option.\u201d\u00a0 Some companies required employees to waive court redress and agree to final and binding arbitration as a condition of employment; others offered but did not require it.<\/p>\n In designing \u201cstepped\u201d employment dispute management programs, all of the companies studied found it necessary to confront certain considerations.\u00a0 These included:<\/p>\n Skills of consensus-building are particularly valuable in this context.\u00a0 The broader the input in program design, the more likely the program will be effectively implemented.\u00a0 Objections to any program features are best heard early in the design stage, and not only addressed, but seen by the objector to have been addressed, in order to obviate their inevitable airing at a later time in less flexible circumstances.<\/p>\n The challenge of early problem identification<\/strong><\/p>\n Four attributes of successful internal employment dispute management programs may be articulated as:<\/p>\n There are a variety of ways that the benefits of early detection of workplace problems may be accomplished.\u00a0 One is the establishment of the office of organizational ombudsman.\u00a0 Such an office is a resource to all members of the workforce, including managers and supervisors, and points inquirers to routes for solutions in a confidential atmosphere.\u00a0 The ombudsman office is not part of Human Resources or the Legal Department, and is answerable directly to the office of the president of the organization.<\/p>\n This is an area in which responsible innovation may reap substantial rewards.\u00a0 One program administrator, when asked what types of issues the program would address, replied that he would discuss with an employee concerns about the patterns of the linoleum on the floor, on the assumption that if the employee voiced concern about that, she had a broader concern about something else, and unless he heard about it now he ran the risk of hearing about in later, in the form of a legal filing.<\/p>\n The underlying premise is broadly shared:\u00a0 Allocation of institutional resources to identify problems at an early stage is the most effective way of preventing later, more expensive claims or disruptive incidents in the workplace.[14]<\/a><\/p>\n Conclusory Observations<\/strong><\/p>\n At the time the Compendium was compiled, not all participating companies maintained statistical reports of trends of usage, outcomes and user satisfaction levels.\u00a0 Moreover, many of these programs no longer are in operation, either because of corporate restructuring, program modification, or other reasons.<\/p>\n Nevertheless, certain of the observations drawn in 2002 may still be useful for program designers today.\u00a0 Among the most prominent are:<\/p>\n <\/p>\n [1]<\/a> F. Peter Phillips is a mediator and arbitrator in Montclair, New Jersey, USA.\u00a0 His professional website is www.BusinessConflictManagement.com<\/a>.\u00a0 He is Adjunct Professor and Director of the ADR Skills Program at New York Law School.<\/p>\n [2]<\/a> Now the International Institute for Conflict Prevention and Resolution.\u00a0 See<\/em> www.cpradr.org<\/a>.<\/p>\n [3]<\/a> CPR Institute for Dispute Resolution, How Companies Manage Employment Disputes: A Compendium of Leading Corporate Employment Programs (2002).<\/p>\n [4]<\/a> The companies whose programs were included in the Compendium were Alcoa, Anheuser-Busch Companies Inc., Bank of America, CIGNA, Credit Suisse First Boston, General Electric, Halliburton Company, Johnson & Johnson, Masco, McGraw Hill, MG Company, Pfizer, Philip Morris USA, Rockwell, Shell, Texaco, United Parcel Services, UBS Paine Webber, U.S. Air Force and U.S. Postal Service.\u00a0 The programs included were those in effect in 2002.<\/p>\n <\/p>\n [5]<\/a> The Compilation included interviews with Richard R. Ross, Senior Associate General Counsel, Anheuser-Busch Companies, Inc.; Donna M. Malin, Assistant General Counsel, Johnson & Johnson; Wilbur Hicks, Shell Oil Company; Geoffrey Drucker, Chief Counsel, Dispute Resolution and Prevention, U.S. Postal Service; Teri P. McClure, Corporate Counsel \u2013 Employment, United Parcel Service; and Elizabeth W. Millard, Director and Counsel, Credit Suisse First Boston.<\/p>\n [6]<\/a> Richard R. Ross of Anheuser-Busch Companies stated in his interview, \u201cWe saw the Dispute Resolution Program as a means to not only provide [a dispute resolution] avenue for employees, but also encourage better management practices.\u201d<\/p>\n [7]<\/a> Geoffrey Drucker, administrator of the REDRESS program at the U.S. Postal Service, said in his interview that, although \u201cthe settlement of the class action [in a Florida lawsuit] was the immediate impetus, behind that was a concern about this rise in complaints and a desire to do something about it.\u201d<\/p>\n [8]<\/a> Elizabeth W. Millard of Credit Suisse First Boston said in her interview that to some degree the company \u201csaw a dispute resolution program as a way of promoting management accountability, because it can demonstrate to managers that, if they make inappropriate decisions, the company will take employees\u2019 complaints seriously, and support the employees\u2019 efforts to seek redress.\u201d<\/p>\n [9]<\/a> Donna M. Malin of Johnson & Johnson said in her interview that the primary metrics her office maintained were the number of employee-related lawsuits and the expense of outside counsel.\u00a0 A secondary metric was the time from assertion of the complaint to resolution.\u00a0 Teri P. McClure of United Parcel Service stated in her interview that \u201c[t[he main reason UPS started looking at alternative dispute resolution is because the largest percentage of our legal department budget was spent on labor and employment related matters.\u00a0 We were looking for ways to reduce costs with respect to labor and employment-related litigation.\u201d<\/p>\n [10]<\/a> Geoffrey Drucker of the U.S. Postal Service notes that the metric chosen has a relationship to the program goal.\u00a0 In his interview he said that the primary purpose of the program was \u201cto improve the workplace environment,\u201d and the program valued information on user satisfaction higher than rates of resolution.\u00a0 \u201c[W]e\u2019re getting about 40% success rate in terms of resolution.\u00a0 And levels of satisfaction with the process are [in the high 90s].\u201d<\/p>\n [11]<\/a> Wilbur Hicks, who administered the Shell RESOLVE program, said in his interview that the CEO of Shell specifically abjured metrics as a means of evaluating program success.\u00a0 \u201c[H]ow do you measure that \u2013 people feeling that they have more of a stake in what happens to them in the workplace?\u00a0 In fact, Phil [Carroll, Shell\u2019s President at the time of the program\u2019s adoption,] would probably say, \u2018Gee, if the number of complaints went down, that\u2019s not what I want \u2013 I want the number of complaints to increase.\u00a0 I really want people to feel safe bringing forth these issues.\u201d\u00a0 In fact, complaints did not increase.<\/p>\n [12]<\/a> Elizabeth Millard of Credit Suisse First Boston articulated, in her interview, the rationale behind designing that company\u2019s program to \u201ccover[] everything as well as everyone\u201d:\u00a0 \u201cI think some companies have decided that they are better off in court with some types of claims \u2013 bonus claims, for example.\u00a0 Whether or not that is true is not an issue for us.\u00a0 We are committed to the principle of alternative dispute resolution for employment-related claims.\u00a0 And if employment ADR is a good thing, then its benefits should be made available as to all types of claims.\u201d<\/p>\n [13]<\/a> Richard Ross of Anheuser-Busch Companies stated in his interview, \u201cThe only reason this worked was that we had the full support of senior management, including the CEO.\u201d\u00a0 Teri McClure of United Parcel Service said that, \u201cas part of the rollout, we used a videotape that included our CEO and our senior VP of HR, telling people that this program was something that the company takes very seriously.\u201d<\/p>\n [14]<\/a> Wilbur Hicks, of Shell, said in his interview, \u201cWe\u2019re getting these things earlier in the process, when the emotions haven\u2019t ratcheted up.\u00a0 Big lawsuits drag on and on and people perceive that the company is resisting and holding out and they become more and more angry, so the price of resolving it goes higher and higher.\u201d<\/p>\n\n
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