Alternative Dispute Resolution for Employment Disputes

Not every legal dispute is resolved through litigation. In fact, there is a very strong chance that yours will not be. A significant portion of the employment contracts signed in the United States stipulate that the involved parties will resolve their dispute through a form of alternative dispute resolution, usually through arbitration. This is primarily done to save money by avoiding litigation, which can become costly if a dispute is not resolved quickly. It is also done to retain a greater sense of control over the dispute’s resolution. The amount of control the respective parties retain depends largely on the method of alternative dispute resolution (ADR) used.

You may be required to work through ADR with your employer to resolve your employment dispute. Whether this is the case or not, it is important that you work with an experienced employment attorney to fully understand the ADR process and have an advocate for your rights and interests. Although the main purpose of ADR is to avoid the courtroom, it is not designed to eliminate legal counsel or representation for the parties involved. Work with an attorney who can protect your rights and ensure that your case reaches a fair outcome.

Types of Alternative Dispute Resolution

There are four main types of alternate dispute resolution that disagreeing parties may use to resolve their issue. Each has unique benefits and drawbacks.

Mediation When an employer and an employee work out their dispute via mediation, they work with a trained mediator to go over all relevant details to reach a mutual understanding. This mediator is a neutral third party who guides the disputing parties’ discussion and encourages productive dialogue between them. The mediator does not have the power to require the disputing parties to honor their agreement. All he or she can do is guide them to the agreement and encourage them to exchange their thoughts about the dispute. After mediation, the parties and their attorneys must then write and sign a document detailing the terms of their resolution.

Negotiation Like mediation, the terms reached through negotiation are not legally binding unless the parties write them into a new contract and sign it. Negotiation is the most open-ended type of ADR and has the fewest requirements. When parties choose to negotiate through their issues, they simply work together to reach an agreement that meets their needs. There is no third party and there are no legal requirements – with negotiation, the parties attempt to resolve their problems between themselves, rather than taking legal action.

Collaborative Law With collaborative law, both parties and their attorneys are equal players in determining an appropriate resolution for the dispute. With this type of ADR, the parties and their attorneys work within specified terms to reach an agreement. Once they reach an agreement, this agreement is not necessarily legally binding. The parties must then go through the court to have their agreement legally finalized, after which they must abide by its terms.

Arbitration Arbitration is the most common type of ADR used for resolving employment disputes because it is straightforward and legally binding. It is much less expensive than litigation and for most individuals, effective at reaching a mutually-satisfying resolution. In many cases, an employment contract requires that the individual use arbitration to resolve his or her dispute.

With arbitration, an individual arbitrator or a group of people designated as a tribunal for this purpose is brought in to determine a resolution for the disputing parties. This arbitrator meets with the disputing parties to hear each’s side of the story and determine the key issues at hand with the case. He, she or they then gather any necessary pieces of evidence or contact information for parties who may provide valuable testimony to the case, such as the employee’s colleagues or a representative of the company’s Human Resources department.

After all necessary information is gathered, each party presents its case to the arbitrator. Following these presentations and testimonies, each party has the opportunity to submit additional evidence before the arbitrator determines a final ruling. Once the arbitrator determines an appropriate resolution, he, she, or they make a legally-binding decision with which the parties must comply.

When Alternative Dispute Resolution Does Not Work

Alternative dispute resolution does not always result in a fair resolution. This can be for a variety of reasons. One of the greatest reasons why ADR, particularly mediation and other non-binding forms of ADR, can fail is when the parties have a significant power imbalance. For example, it can be impossible for an entry-level associate to successfully resolve a claim against his or her multi-billion dollar-earning corporate employer through alternative dispute resolution. Another example of a situation where ADR is not advisable is when there are sensitive issues at play, such as in a sexual harassment case.

If a resolution cannot be met through ADR, the disputing parties may take their case to court to have a judge and jury settle it. This can be expensive and time-consuming, but in some cases, it is the only way to reach an appropriate resolution. This is especially true if there is a public interest or legal precedent component to the case. Many contracts that require disputing parties to go through arbitration state that if arbitration does not work, they can take their case to court.

Whether ADR is required of you or not, it is important that you talk to your attorney about all of the possible ways your case can unfold as you and your employer work to reach a solution. He or she can prepare you for what is coming with your claim and what you can expect with each type of resolution process. In any of the resolution processes mentioned above, your attorney plays a crucial role by advocating for your interests. The jargon contained in your employment contract and the privileged position your employer holds can work to keep you from questioning the resolution that is presented to you. But do not allow yourself to feel intimidated. Instead, bring all proposed contracts and agreements to your attorney to determine if they are fair and reasonable.