Workplace Mediation: Frequently Asked Questions

Why choose workplace mediation?

Until workplace mediation was an option, employers and employees who were parties to a workplace dispute proceeded directly to formal administrative adjudication, such as the Equal Employment Opportunity Commission (EEOC), or through the state or federal court system. These formal processes often mean that both employers and employees are financially burdened with the costs of engaging legal representation and taking time away from their business or job for attendance.

Workplace mediation offers an informal, less adversarial, and completely voluntary alternative for employers and employees to resolve disputes. By opting for mediation, parties have nothing to lose because they are still eligible to access more formal processes if their dispute cannot be resolved through voluntary mediation.

Who participates in workplace mediation?

Workplace mediation includes mediation between:

  • Employees
  • Supervisors and employees
  • Managers and/or executives
  • Departments
  • Board members
  • Boards and staff

What is the cost-benefit of workplace mediation?

Rule of Thumb: It is estimated that the cost of conflict across all employees is at least 2 hours of work lost on average per employee per week. This means, every 20 employees represent one full-time salary that is paid for nothing. Total number of employees, divided by 20, multiplied by the average annual salary paid by the company gives us an estimate of annual loss due to mismanaged conflict.

Example: In a company with 100 employees and an average salary of $25,000, this “invisible cost” is estimated at $125,000 dollars a year!

Companies are now turning to workplace mediation to manage risks, control costs, amicably resolve workplace issues, and improve employee morale.  

Conflict in the workplace is a fact of life. However, unresolved workplace conflict becomes costly in terms of time spent managing conflict, turnover rates, productivity lost, the overall decay of workplace morale and legal costs. Look at the facts:
    

  • Owners or senior executives, depending on the size of the company and complexity of the product or services provided, may spend up to 20% of their time in litigation-related activities.
  • Typical managers may spend up to 30% of their time dealing with employee conflict.
  • The turnover cost for an employee is estimated to be 75%-150% of their annual salary.
  • The cost of locating replacements and training them is estimated at 50% of the annual salary paid for the job being replaced.
  • Of employees who terminate employment, 16% report conflict with a supervisor as the main reason for leaving.
  • People spend valuable time distracted from work by conflict with another employee or supervisor.
  • The number of people included and involved in a workplace dispute expands over time, including supervisors and HR staff who spend many hours trying to resolve the issues.
  • Less work gets done and, as stress increases, the quality of work suffers.
  • Morale suffers, absenteeism increases and when experienced workers leave, their absence disrupts work.
  • Poor solutions, such as restructuring the work flow to keep the conflicted parties apart, undermine output and contribute to a decline in morale.

Other, less obvious, costs associated with workplace conflict include: stress-related medical claims; anger; blame; and the creation of a hostile work environment. And, workplace harassment lawsuits are frequently based on a hostile work environment theory.

How does workplace mediation work?

Workplace mediation is an informal, confidential, less interventionist way of resolving disputes. It is commonly used to resolve disputes more quickly and cost effectively. 

The mediator is an independent person who sits down with the disputing parties to help them work through their differences and, hopefully, arrive at a mutually acceptable solution.  Unlike an attorney, a mediator guides the process of resolution, but does not advise the parties in the dispute.  The mediator’s role is to provide the parties with a framework to work through the issues, help the parties identify possible solutions, and facilitate final agreement. A mediator has no decision making powers.

A mediation session is not like a court hearing. As a general rule, legal or other representation at the mediation session will not be permitted unless all parties agree.

What are the benefits of workplace mediation?

Workplace mediation can be a practical alternative to formal dispute resolution because it gives both parties direct ownership of the outcome, that is, the terms of the settlement are determined by the parties themselves.  

There are many benefits to using mediation as an alternative to formal dispute resolution processes. It enables disputes to be dealt with in a flexible framework that encourages simple, prompt and creative solutions. And, it can help to avoid the breakdown of relationships that can occur with more adversarial approaches.  

Other key benefits include:
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  • Parties have the capacity to take responsibility for the own workplace relations, preserve relationships where possible, and promote cultural change at the workplace level.
  • Mediation ensures that genuine attempts are made to settle disputes before resorting to administrative or legal action.
  • Legal or other representatives may be avoided, as well as formal hearings away from the workplace.
  • Solutions reached are often more durable than adversarial processes because of the participative nature of mediation.
  • Mediation processes can improve workplace relationships and the parties’ perceptions of each other in a way that is often not possible with more adversarial approaches.

What are the advantages of using an external mediator for resolving workplace disputes?

Impartiality. An external workplace mediator does not represent the company and does not have a personal relationship with the parties. The mediator is, therefore, perceived as impartial by the parties to conflict. The external mediator brings a fresh view to the situation, offers assessment of the problem, recommends resolution, and has the skills to help resolve the conflict in a constructive and productive way.

Confidentiality. The external mediator assures parties to mediation of confidentiality. Only general outcomes, and whatever participants agree to, are reported to the company.

 

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