Alternative Dispute Resolution

Conflict Defined:

A prolonged battle A struggle A clash A controversy A disagreement Opposition

Conflict Resolution Styles:

Avoidance Accommodation Compromise Collaboration Confrontation/competition

Insist on Using Objective Criteria

Basis that is independent of the will of either side/Develop fair criteria Fair Standards Fair Procedures

Steps in mediation: Clarification

Clarify agreement Affirm it is the parties' agreement Confirm parties' understanding of agreement terms

Confrontation/Compeition

Confrontation/Competition Addresses conflict directly Both persons out for themselves Can result in violence

Unethical Tactics

Decoy -using a ploy to disguise the real issue Red Herring - using a ploy that will be withdrawn on if a concession is given Cherry Picking Deliberate Mistake/Erroneous conclusion Default Escalation Planted Information

Steps in mediation: Fact Finding

Each side tells their story Reword judgmental language used by parties Help parties prioritize issues Acknowledge emotions Avoid leading questions Avoid closed question (those that can be answered by yes or no) Summarize each sides' statement of facts

Steps in mediation: Option Generation

Elicit suggestions for agreement Allow face saving Check with all parties involved Concentrate on what each will do Avoid limited pie approach

Arbitration's Statutory Source

Federal Arbitration Act

Conciliation

Like mediation with one crucial difference: the mediator/conciliator is expected to recommend to the parties ways to reach a compromise. Not legally binding on the parties.

Setting the Climate

Never start out confrontational Disagreeable positions - don't argue but look to facts. Use the Feel, Felt, Found formula to turn it around

Prescriptions for inventing options

Separate creating options from judging them Broaden the options on the table Search for mutual gains Invent ways of making their decisions easy

Principled Negotiation Method

Separate the people from the problem Focus on interests, not positions Invent options for mutual gain Insist on using objective criteria BATNA Relationship - Can I sustain or improve it?

Negotiation Techniques

Setting the Climate Nibbling Uproar Good Cop/Bad Cop Higher Authority Commit Settlement to Writing

Rapport Achieved by:

Sharing experiences, Building trust, etc.

Arbitration is Contractual Substitute for Litigation

Takes place in lieu of a trial. If parties agreed to arbitration, they will be held to the agreement Either side will be able to block the other side from pursuing an action in court.

The term arbitration refers to:

The use of a neutral third party to hear both sides of a dispute and render a written decision, called an award. The award is imposed on the parties following consideration of each side's position.

What are the advantages to choosing ADR?

Timely resolution Generally takes less time than trial Parties in control Parties decide who participates, timing, terms Cost effective Trials generally more costly Confidential Not on public record, no media, no embarrassments Expertise Mediator or arbitrator usually has expertise in area of dispute Satisfaction Parties can influence process to get what they want Compliance Where parties play a role in decision making, more likely to comply Informal Less stressful, more relaxed process Improved relationships Parties working together to reach a result

Steps in mediation: Choosing among alternatives

Use objective criteria Stress shared interests Discuss BATNA Make a reality check/test Encourage parties to make suggestions for resolution

Arbitration Ethics

A good arbitrator conducts an efficient and bias-free hearing, pursuant to either contract or statute, and makes a fair and independent award based upon the contract or the law. Must avoid any conflict of interest and maintain confidentiality. Must conduct process diligently and without undue delay.

Mediation

A neutral third person helps the parties reach a compromise. The mediator consults with both sides and determines what common ground exists between them. The mediator doesn't offer an opinion, but works through the offers of each side.

The term mediation refers to:

A neutral third person who helps the parties reach a compromise. The mediator consults with both sides and determines what common ground exists between them. The mediator doesn't offer an opinion, but works through the offers of each side. Sometimes referred to as: facilitated negotiation

Uproar

A tactic used to upset, anger, or disturb another person How to address this? Keep calm?

Accommodation

Accommodation Examples Broken lease scenario- pay the penalty to get out of the lease? Not dating scenario - act of omission When you decide on inaction, you must weigh the gains and losses Reasons for Accommodation Result immediate, often private May have a need to solve problem now, not later Control over the process and the outcome May not be worth the costs to continue the dispute

Steps in mediation: Issue Clarification

Ask parties: "What do you want to achieve with this mediation?" Reinforce points of agreement Determine points of disagreement Focus on interests, not positions

Hard vs. Soft (Soft)

Avoid personal conflict Makes concessions early to reach agreement May feel exploited or bitter Be soft on the problem and the people Goal is agreement Trust others Make offers, not threats Yield to pressure

Avoidance

Avoidance Examples Broken engagement scenario - should Randy ask for the ring back? Split tab for meals - should Cassi ask Amy to repay? When you decide on inaction, you must weigh the gains and losses Reasons for Avoidance Immediate, final, and often private resolution May be better to wait until later to resolve it Result of decision is known to the party who chose inaction - don't have to wonder because took matter under control Reasons for Avoidance Often lesser costs - no attorney fees, discovery, court costs, etc. But has given away a legal right to other side- someone who has no right to a windfall

Arbitration Appeals

Award procured by fraud, corruption, or undue means Evidence of partiality or corruption in arbitrators Misconduct - failing to postpone hearing upon cause shown; refusing to hear pertinent evidence; other misbehavior Exceed powers or imperfectly executes powers- Standard: mutual, final, and definite award was not made

BATNA

Best Alternative to a Negotiated Agreement What will I do if I don't reach agreement?

Similarities of arbitration with litigation

Both involve an adversarial proceeding in which competing parties make arguments and present evidence before a third party who will render a decision.

How does the mediator prepare?

By choosing a model to follow Facilitative model: Manager of communication; parties mostly in control, works through each side's offers Evaluative model: Active involvement, evaluating conflict, suggesting solutions, urging acceptance of solutions

Arbitration Process

Choose an Arbitrator Conduct Discovery Hold Hearing Decision Making Render Award

Collaboration

Collaboration Win/Win approach - both sides gain Satisfies the concerns of both sides/reinforces trust and respect Ex. Asking for a raise when the employer has no money to give - what might be a solution?

Compromise

Compromise Give up something to get something Example: haggle over a price - each person moves from original price to a middle level Politics example: The Missouri Compromise of 1820 and subsequent Kansas Nebraska Act Some conflicts should not be compromised

Differences between arbitration & litigation

Conference room in office complex arbitrator chosen by parties relaxed rules of procedure and evidence follow law, business practices, common histories between parties Streamlined timetable for decision making Limited opportunities for appeal Contract based

Rapport:

Creating an open and receptive relationship with strangers State of positive mutual attention marked by harmony and affinity Pre-negotiation chats - "small talk"

Adjudicative Process: Private Judging -- "Rent-a-Judge"

Criticisms: Private matter, so no precinct set Not appealable unless statute so provides Drains off judicial resources

Ombudsman Function:

Dealing with feelings Giving and receiving information on a one-to-one basis Counseling and problem-solving to help the manager or employee help himself or herself Shuttle diplomacy Mediation Investigation Adjudication or arbitration (rare) Upward feedback

Steps in mediation: Introduction/Orientation

Describes who the mediator is (neutrality) Describes the rules to be followed Describes confidentiality Check for any conflicts of interest Confirm parties' understanding

Rapport Building Behaviors:

Face the other person Lean forward Make eye contact Nods of understanding Mimicry of voice tone, facial expressions, mannerisms, posture

Higher Authority

Feeling agreement is complete subject to decision by a "higher power" A higher power may or may not exist How to address this? Upfront discussion - who else is involved in the decision making? Commitment with recommendation Agreement with "Subject to" clause

Rapport Building Exercises:

Finding common interests Finding differences Initiating small talk Saving face (something that prevents loss of dignity or self esteem) -- partial victory for other side, involvement of other side in solution Building trust

Nibbling

Getting a little more after already reaching agreement Example - car salesman who gets you to commit to a sale, then tries to add on High school graduation gift - trip to Europe, spending money, new luggage How to address this? Seek reciprocity Works if the request for "slight changes" was sincere in first place

Arbitrator as the expert

Gives confidence to the parties that the decision reached is solidly grounded on both: The facts of the dispute; and The business practices in the field in which the dispute arises

Hard vs. Soft (Hard)

Hard - Contest of wills Who bends first May harm relationship - parties no longer in business together or even talking Be hard on the problem and the people Goal is victory Makes threats Mistrusts others Apply pressure

Commit Settlement to Writing

How to address this? Specify as much as possible in precise language Facts at issue: what happened, pain & trauma of recovery (medical terminology if needed) Liability: whether or not taking personal responsibility, any outside support for liability (police report or witness statement) Money damages: lost income, nature & cost of treatment, payment all at once or over time Actions to be taken: confidentiality of settlement Release of all claims - what is the scope?

Adjudicative Process: Arb-Med

Hybrid - part arbitration/ part mediation Same neutral starts out as the arbitrator If process is not resolved, same neutral becomes the mediator Arbitrator does not announce award at close of arbitration. If mediation is unsuccessful, the arbitration award is made known and binding.

Adjudicative Process: Med-Arb

Hybrid - part mediation/part arbitration Same neutral starts out as the mediator If process is not resolved, same neutral becomes the arbitrator Criticisms: Neutral learned confidential information during mediation, so how can neutral stay neutral?

Rapport Based on:

Idea that people are in a position to help one another

Cons of Arbitration

If a party wants to warn others of the danger posed by whatever is the subject of the arbitration, a confidential award won't suffice. Hard to predict the outcome of an award, leaving the parties with a feeling of uncertainty until an award is reached. Very rarely is arbitration voluntary - often a condition of receiving services & stated in contract

Distributive vs. Integrative Bargaining

In distributive negotiation every negotiator focuses on meeting his personal interests, regardless of the loss the others may have to face. In contrast, integrative negotiation focuses on mutual interests of all the parties and thus, comes up with constructive solutions that will be beneficial for all distributive bargaining is when there is a finite amount to be divided between parties Parties act defensively and try to establish a 'best' position for themselves Parties are viewed as adversaries integrative bargaining is when parties work together for mutual gains Efforts are directed towards maximizing gains for everyone, rather than focusing on personal (party) gain

Conflict Sources

Ineffective communication patterns Power imbalance Divergent values Injustice Different experience levels Societal change Difference between individuals, organizations, and nations Limited Resources Failure of communication, incomplete communication, or incorrect communication Anger, mistrust, and fear Conflict over shared responsibility Thwarted expectations and change of roles Difficult people

Focus on Interests, Not Positions

Interests - the motivators behind the positions we take Positions - the side that you take Interests - what caused you to decide

Mediation Process:

Introduction/Orientation Fact Finding Issue Clarification Option Generation Choosing among alternatives Clarification Closing (Implementation if necessary)

Applications for Arbitration

Labor relations Interest - the parties are at an impasse in their negotiations; can't agree to the terms they want in an contract Grievance - the parties already have the terms of contract in place, but dispute the meaning or significance of the terms. Sports - final offer arbitration - must choose from one of two offers submitted by parties Commercial Disputes Court-Annexed Consumer Disputes

What are the disadvantages to choosing ADR?

Less safeguards Rules of evidence relaxed in ADR Statutes of limitations If ADR drags on, parties may lose the right to sue Unequal bargaining power If one side is more able to control the other, then no advantage to using ADR No injunctions Can't force parties to do something or refrain from doing something Judicial review limited Courts generally limited in review of arbitration decisions Enforceability Most forms of ADR not legally binding, unless reduced to a signed contract May not succeed Have to go to court after all

Arbitration

Most formal method of ADR. A third party makes a decision on behalf of both sides. Generally considered legally binding on the parties.

Negotiation

Negotiation is the simplest form of ADR. Two people with a dispute can negotiate with each other and reach a solution themselves. Can be completely private, fast, and cheap. A conferring, discussing, or bargaining to reach an agreement

Types of ADR:

Negotiation, Mediation, Conciliation, Arbitration

Good Guy / Bad Guy

One seemingly reasonable negotiator to soften resistance paired with unreasonable negotiator who trashes negotiation effort Seen in many TV shows and movies How to address this? Identify it to the other side Focus on the good guy, not the bad guy

Separate People From the Problem

Perception, Emotion, Communication Perception: understand other point of view Emotion: why is other side angry Communication: Active listening, speak to be understood, speak for a purpose, speak about yourself not them

How do parties act during mediation?

Practice good communication skills Be open and respectful Act reasonably and in good faith Listen with few interruptions Make opening statement brief and compelling (in human terms) Link offers and concessions to interests

Obstacles to inventing options:

Premature judgment Searching for a single answer Assuming there is a fixed pie Thinking that solving their problem is their problem not yours

Principles Negotiation Method

Principled Negotiation Method Separate the people from the problem Focus on interests, not positions Invent options for mutual gain Insist on using objective criteria BATNA

Types of Arbitration

Private Arbitration: a process chosen by the parties outside of the court system Court-Annexed Arbitration: takes place in the courthouse by arbitrators provided by the court system and under court authority Binding Arbitration: The arbitrator's award is final and generally not appealable. Courts traditionally honor binding arbitration awards; rarely overturn them; limited grounds to win an appeal Nonbinding Arbitration: parties are notified, after initial pleadings are filed with the court, to appear before an arbitrator to present their case. If the parties are satisfied, it becomes a judgment within that specified period of time. If either party is dissatisfied and notifies the court, there is a trial de novo of the matter. Mandated by court or court annexed

Solution Principled Negotiation:

Problem-solvers wise outcome reached effectively and amicably Soft on people; Hard on problem independent of trust Focus on interests, not positions Invent options for mutual gain decide options later Insist on using objective criteria standards that are independent of will reason Yield to principle, not to pressure

Positional Bargaining

Start bargaining by stating a position "I want this" or "You can't have that" Stereotypical example - haggling over the price of something Get deeper into positions until you agree or give up

Successful Ombudsman Examples:

The insurance company's ombudsman was able to resolve the problem. The town's ombudsman said he would look into charges of corruption.

The term conciliation is like mediation with one crucial difference:

The mediator/conciliator is expected to recommend to the parties way(s) to reach a compromise Not legally binding on the parties though

What is Alternative Dispute Resolution?

The process involved in assisting people to resolve their disputes without going to court. Really any means of resolving disputes outside the courtroom. A substitute for a formal court hearing. Commonly referred to as ADR

How do parties prepare for mediation?

The same as in negotiation: Separate people from the problem Focus on interests not positions Invent options for mutual gain Employ objective criteria Know your BATNA

Steps in mediation: Closing

Write agreement if appropriate Parties sign agreement and receive copy Keep door open for future conflict resolution Close mediation session comfortably Schedule follow-up - may need to renegotiate to fine tune agreement

Ombudsman defined:

a government official (as in Sweden or New Zealand) appointed to receive and investigate complaints made by individuals against abuses or capricious acts of public officials Someone that investigates, reports on, and helps settle complaints