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Feature

Mediating a Better Outcome

The EEOC Mediation Program fosters less-adversarial ways to address employees' discrimination complaints.

November 1, 2007 | Kathryn Tyler



Bethann Rodgers, a manager in the Equal Employment Planning Office at Ford Motor Co., tells of her recent experience with a federal mediation initiative to resolve workplace discrimination complaints quickly and efficiently.

The complaint arose when a female employee who was moved to a different shift filed a discrimination charge on the ground that the move was based on gender, Rodgers says. Under an agreement that Ford had signed with the Equal Employment Opportunity Commission (EEOC), an EEOC mediator was brought in to resolve the issue. "We explained the move was based on seniority and the collective bargaining agreement," says Rodgers, who works in the automaker's headquarters in Dearborn, Mich. "Once she learned it had nothing to do with being female, she was OK with it."

Although Ford historically has used mediation to resolve complaints, in 2004 the company signed a National Universal Agreement to Mediate (NUAM) with the EEOC. The agreement declared the company's commitment to turn to mediation first to resolve EEOC charges. Since then, Ford has participated in 55 EEOC mediations, and about half resulted in resolution of the complaints.

The rest went through the traditional EEOC investigative process. Richard W. Gross, director of personnel relations and employee policy for Ford, describes mediation as "a forum where the issue can be discussed and resolution can be sought without spending a lot of resources defend ourselves. It's no risk. It's an effort to resolve things early in the process."

Gross says mediation also provides a company with an outlet to clarify its position and explain "why things happened way they did." Rodgers says mediation "gets everyone communicating on the same page." In fact, former EEOC Chair Cari Dominguez sees no downside to mediation: It is "much friendlier than a contentious, protracted investigation," she says, and it addresses conflicts "before positions become entrenched and acrimonious."

Moving to Mediation

Every year, about 75,000 individuals go to their local EEOC offices and accuse their employers or potential employers of discrimination based on age, race, gender, religion or disability. And every year, thousands of HR professionals receive notice that their employees have filed EEOC complaints against their companies. What follows next represents every HR professional’s bad dream: photocopying files, arranging EEOC staff interviews with employees, and explaining company policies and procedures, not to mention dealing with the rampant rumors and productivity disruptions that can result.

An underused alternative to those difficulties: participation in the EEOC mediation process, an informal, confidential service provided by the federal government as a way to settle some complaints before they reach the potentially costlier and more time-consuming processes of investigation or litigation. In the mediation process, a neutral mediator attempts to negotiate a mutually agreeable voluntary resolution between employer and employee at no cost to either party.

The mediator does not assign guilt or impose judgment. Neither party is required to accept the terms of the proposed resolution, and both parties remain free to walk away from mediation at any time. According to the EEOC, 72 percent of complaints that go to mediation are resolved. Of the employers that have participated in the EEOC Mediation Program, 96 percent say they would do so again.

Benefits of Mediation

Employers who have tried mediation generally find that the process results in quicker resolution, minimizes hassles, saves money and preserves relationships.

Quicker conclusions. Mediated cases usually are resolved within three months, whereas investigated cases take six to 18 months to resolve. “While that charge is pending, the employee is clearly not happy and may not be productive,” Gross says. “Mediation gets those issues resolved quickly, and gets that employee back to being productive.”

Fewer hassles. Mediation requires a lot less preparation by the HR professional than an investigation does. John Schmelzer, acting director of field coordination programs for the EEOC, says that in an investigation, “we request information from the employee’s file. You have to get it and reproduce it. Then you have to explain [it]. In mediation, you can avoid that. The government isn’t going to be looking through files and interviewing [employees]. And, it’s successful almost three out of four times.”

The demands of an investigation on HR staff can be a particular burden for small departments, says Melva Tate, PHR, director of HR and administration at Kelly Construction Co. in Trussville, Ala. “The amount of time you spend gathering the material is exhausting. Mediating a claim vs. [being party to an investigation] saves enormous amounts of time.”

Reduced costs. Unlike litigation, mediation is free. Angela Rud, interim vice president of HR for International Dairy Queen Inc., a national ice cream franchisor with 2,400 employees, estimates that, since 2004, the company has saved at least $25,000 in legal fees by choosing to mediate and settle early rather than litigate. In addition, mediated cases generally resulted in lower payouts than those that were vigorously defended, Rud says.

Richard P. Hasenauer, vice president and director of HR for Gerresheimer Glass Inc., a glass manufacturer with 1,700 employees and U.S. headquarters in Vineland, N.J., agrees. “It is easy to compare our HR representative’s time against [attorneys’ fees] and recognize a considerable cost avoidance if you get an agreement,” he says.

Continued relationships. Thomas M. Miller, senior labor counsel for Meijer, a nationwide grocery chain, says mediation can help deal with issues affecting current employees who will remain with the company after the charge is resolved. In those cases, he says, amicable resolutions achieved through mediation “can often be more beneficial in the long term than getting a no-probable-cause dismissal.”

Reaching a Resolution

Settlements reached in mediation can range from an apology or a neutral letter of reference to significant monetary compensation. Karen M. Bellinger, supervisory alternative dispute resolution (ADR) coordinator at the EEOC office in Indianapolis, says, “Any agreement you reach is a no-fault settlement.

Just by settling doesn’t acknowledge [an employer] did anything wrong. A lot of times [a settlement] is a business decision.” Because mediation is a less-structured process than an investigation, the discussion can include other issues affecting the employee besides the discrimination charge, says Steve Ichniowski, national ADR coordinator at the EEOC in Washington, D.C. Ichniowski tells of a travel agency employee who, after working for the company for 25 years, filed a gender discrimination charge.

The employee was under a great deal of stress because she felt she was being unduly criticized. “Here was a loyal employee who started having performance problems,” says Ichniowski. Since the employer knew the woman’s honeymoon travel arrangements had fallen through, the company significantly reduced her stress and gained good will by giving her a honeymoon package as part of the resolution. The action helped the company retain a longtime employee.

“A judge isn’t going to award that type of settlement,” Ichniowski says. “When it’s mandated by a judge, his hands are tied [by the type of compensation he can award].” Other settlement agreements may include departmental transfers, shift changes or retraining.

Myths, Fears and Apprehensions

Although about 85 percent of charging parties agree to go to mediation for an EEOC charge, only about 30 percent of employers agree to mediate, according to the EEOC. The main reasons that employers give for rejecting mediation are:

The charge has no merit. In a 2003 study of the EEOC Mediation Program by E. Patrick McDermott, Ph.D., J.D., primary researcher at the Franklin P. Purdue School of Business at Salisbury State University in Salisbury, Md., the most common reason given by employers is that the charge is baseless.

Dominguez says, “Employers perceive the government won’t take on this ‘frivolous’ charge. However, the government applies different standards than the employer.” She advises HR professionals not to take employees’ allegations lightly, “regardless of how you feel about them. They can contaminate the situation and affect other employees.”Agreeing to mediate is not a validation of an EEOC claim. Instead, it is a gesture of good will demonstrating a company’s desire to understand an employee’s dissatisfaction. Sometimes, this is enough to appease a disgruntled employee.

The mediator isn’t qualified. Three types of mediators handle these cases: in-house mediators working directly for the EEOC; contract mediators, usually lawyers or judges; and volunteer mediators, who usually serve in less-populated areas. Schmelzer says the majority of cases are handled by fulltime mediators. Because some HR professionals say they have had mixed experiences with mediators, experts advise doing a thorough check with other NUAM participants to evaluate the quality of each mediator.Rud says, “Some mediators are good, and others are not.” Tate, who mediated six EEOC charges for her previous employer, says the quality of the mediator affects “how well the process flow[s] and how successful the outcome [is].” If a mediator is perceived as successful, an employer can request that person for future mediations.

The information disclosed could be used against the company. “Employers fear that something said during mediation will hurt them on the investigative side,” says Dominguez. But, Schmelzer says, a “protective firewall” separates mediators from enforcement staff. “There are separate files for the mediation and investigation processes,” he explains.

The mediator will force the company to pay a huge settlement. Some employers fear mediation is about a payout, but “that has not been the case for us,” says Ford’s Gross. “Neither party has to accept the result. It’s not binding arbitration. At the end of the day, if you cannot agree, you can walk away and go through the normal EEOC charge process.”

Moreover, not all resolutions involve money. “About 20 percent of mediation resolutions do not involve any transfer of funds,” Dominguez says. And any compensation must be agreed to by the company. No HR professional wants to have to face an EEOC charge. But by having a universal agreement to mediate (see “Making Mediation an Automatic Recourse” on page 65) or—at the very least—having an informed opinion about mediation and a plan for addressing employees’ discrimination complaints, HR professionals can be prepared to handle such charges if and when they arise.

Kathryn Tyler is a freelance writer and former HR generalist and trainer in Wixom, Mich.


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