A Guide To Alternative Dispute Resolution: Arbitration & Mediation

Alternative Dispute Resolution

There are few controversies that can be more damaging to a business than a dispute with an employee – and if that employee happens to be a key executive, the impact of that dispute can be even worse. In this episode, we're joined by Ross Runkel. Ross has spent the better part of his career working in dispute resolution, serving as an independent labor and employment arbitrator and mediator, and today, he'll explain:

  • The four different types of Dispute Resolutions;
  • How to choose the right Dispute Resolution process;
  • The importance of selecting the right arbitrator; and
  • Walk-throughs of the mediation and arbitration processes!

“The key consideration is whether you want to turn the ultimate decision over to an outsider, an arbitrator, or do you want to work out an outcome that's agreeable to both sides? That's what a mediator will do." @RossRunkel #DisputeResolution #Mediation 

Click to Tweet

If you prefer to read along while you listen, we've done all the hard work for you! We listened back to this episode and took notes below, and access is free! 


Examples of Employer-Employee Disputes

  • An employee claims they were unfairly or illegally fired. 
  • An employee wants to work overtime, but can’t.
  • An employee doesn’t want to work overtime, but is forced to.
  • Sexual harassment. 
  • Racial harassment.  
  • An employee was passed up for a promotion.
  • Independent contractors can also file these kinds of disputes.
ProjectHR Podcast Logo

UNLOCK THE FULL EPISODE COMPANION GUIDE

Get all the notes, links, tips, tricks and most important content from this episode - for free!

By signing up you agree to our terms

What Happens After an Employee or Contractor Files a Complaint?

  • Usually, a dispute is settled by a one-on-one discussion between the employee/contractor and their manager. 
  • If the employee has a union, there may be a formal process as outlined by a collective agreement. 
  • If there’s no union, a company may have an internal complaint system. These vary from company to company and can be found in the company handbook.
  • If there is an external complaint, a company may be looking at a lawsuit or arbitration. 

Different Types of Dispute Resolutions

  • Litigation involves a judge and a jury. It’s an extremely formal process with rules and an appeals process. Litigation is part of the government and legal system. 
  • Arbitration, on the other hand, is a private process. It is not part of the government or the legal system, and there’s no jury. The decision of the arbitrator is final and binding -- what they say goes. 
  • Mediation. The mediator has no final authority or decision-making power. Instead, they help the parties reach an agreement. 
  • Negotiation resolves most disputes. It is simply two people working out a resolution. 

Mandatory Arbitration

  • Arbitration is a voluntary process.
  • When an employee is hired, they’ll sign an agreement to arbitrate any future disputes. This is called a pre-dispute arbitration agreement. So if a dispute ever happens, the courts will enforce this arbitration agreement.    
  • In this case, arbitration is “mandatory” because the employee originally and voluntarily agreed to it. 

Avoiding Litigation

  • Litigation is a long, complicated, expensive, and draining process. And it can look 
  • Companies often try to avoid jury trials.
  • Litigation can damage a company’s image.

Choosing the Right Dispute Resolution Process  

  • Mediation is great for maintaining a positive relationship between an employee and a company. A mediator will help both sides come together in a creative solution that will hopefully satisfy everyone. 
  • In arbitration, on the other hand, an outside party (the arbitrator) comes in and makes the final decision. 
  • Arbitrators are often seasoned lawyers with litigation experience or labor relations experts.
  • When looking for an arbitrator, parties can go to an agency like the American Arbitration Association, JAMS (the Judicial Arbitration and Mediation Service), or FMCS (the Federal Mediation and Conciliation Service) -- or the parties can simply agree on a particular person. 
  • Mediators can also be lawyers or labor relations experts, or they may be specifically trained in mediation. 
  • It’s more common for parties to seek out a particular mediator, but they can also go to an agency.

The Mediation Process  

  • Mediation starts with the mediator bringing everyone together.
  • Then they talk with and listen to both sides and try to reach a solution. 
  • The mediator will often split the two parties into separate rooms to talk with them individually. Then they will relay messages back and forth between the two parties. 
  • Mediations are confidential. 
  • This process usually only takes one day, though it can sometimes be a long day. 

The Arbitration Process  

  • Arbitration looks a lot like litigation. 
  • The arbitrator starts by bringing both parties into a room. 
  • Then each side gives an opening statement, produces witnesses, submits documents, and gives closing statements. 
  • At the end of the day, an arbitrator will go home and write up their decision. That decision is final and binding (however, the loser can go to court and try to get the decision reversed). 

Labor Arbitration vs Individual Arbitration  

  • Labor arbitration arises from a union collective bargaining agreement. 
  • Individual arbitration is between an individual and their employer. These cases can often involve legal statutes like Title VII, the Age Act, etc. 

Different Types of Labor Arbitrations  

  • Grievance arbitrations involve a breach of a collective bargaining agreement. 
  • Interest arbitrations involve negotiation of a new contract. If parties can’t agree on a new contract, an arbitrator makes the decision for them. These are common among police officers and firefighters, because they cannot go on strike.

Class Action Arbitration   

  • Class action arbitration is where the main complainant represents a larger class of people.  
  • A recent example is when drivers for a food delivery company sued in court, saying they should be classified as employees, instead of contractors. The company was able to get the court to compel one-to-one arbitration where each individual employee had to file for arbitration. This company had to pay over $10 million in filing fees. 
  • Some employers include a class action waiver in their agreements that prevents a case from becoming a class action arbitration. 

The State of Mandatory Arbitration  

  • Many companies have decided that sex and race discrimination cases should no longer be settled by arbitration. 
  • Other than that, arbitration looks like it’s here to stay.

Ross Runkel

  • Mr. Runkel is both an arbitrator and a mediator, though he mainly does arbitration.
  • He works in Western states, including Nevada, Colorado, Alaska, Montana, Idaho, and California. 
  • Mr. Runkel’s video blog has a great deal of resources, including videos on how to choose an arbitrator, how to prepare for arbitration, a series on notable cases and decisions, and informational videos about employment law. 

Ross Runkel Backstory

  • Bachelor’s in Psychology from the University of Washington.
  • J.D. from the University of Washington School of Law
  • Worked in law for over 50 years.

  • Taught law at Texas Tech University, the University of Washington, and Willamette University College of Law.Mr. Runkel is currently an independent labor and employment Arbitrator and Mediator.

Contact

Subscribe & Review The ProjectHR Podcast!

Thanks for tuning into this week’s episode of ProjectHR. If the information in our weekly conversations and interviews have helped you in your business journey, please head over to wherever you get your podcasts and subscribe to the show. We'd also love it if you left us a five-star review! Your reviews and feedback will not only help us continue to deliver great, helpful content, but it will also help us reach even more amazing professionals just like you!

iTunes
Stitcher
Overcast

About the Author Jacqueline Gregory

As a creative, persuasive communications professional with extensive experience guiding projects from concept through completion Jacqui has produced custom communications for some of the world's best known brands. Producing ProjectHR has been one of her favorite ways to engage and delight HR and Labor Relations professionals!

follow me on: