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Human Law Ezine - June 2009

Redundancy – to mediate or not to mediate, that is the question

As Human Law Mediation reported back in April business owners and public sector bodies are more likely to face employment tribunal claims than ever before.

As the recession continues to bite, and our Government seems to spend all it’s time arguing amongst itself instead of tackling economic challenges, redundancies and employee disputes are on the rise.

Companies and organisations around the UK are facing the joint pressures of making ends meet coupled with concerns over the prospect of disgruntled staff and possible legal action if delicate employee matters are not handled strictly to the letter of the law.

Managing disputes in this situation is frightening for the uninitiated and dangerous for those who think they know it all.

Those wanting to avoid costly legal bills might look to mediation as a way to tackle employee disputes and redundancies – it can look like an attractive solution. But hold on – there are pros and cons with using this, as with any, method of dispute resolution.

The Pros of Mediation

If you mediate, you are using a tried and tested technique for resolving conflict. In a resent ACAS survey of the businesses that had used mediation, 82% said it had resolved the issues completely or partly. With mediation you have a good prospect of allaying the concerns of staff and nipping the problem in the bud.

Mediation can be a much quicker way of resolving difficulties. Going through a formal redundancy situation can involve a full consultation process; instructing lawyers to handle the case will invariably mean meetings to discuss the circumstances and exchanges of correspondence over weeks and sometimes months. A mediation can often be agreed and take place within a week.

Redundancy tends to be less confrontational than dismissal for reasons such as gross misconduct. The mediation environment itself is also less antagonistic. In redundancy situations there can be a lot of hurt felt by the employee. A good mediator will provide an opportunity for these feelings to be aired and whilst there may be no action that can be taken sometimes being given this opportunity is enough to diffuse the situation. For the employer listening to how the employee feels they have been treated can be a useful learning exercise for the future as they ask themselves whether they could have done anything differently.

Mediation is an excellent way of clearing up misunderstandings. In redundancy situations the element of secrecy and internal politics can often be what creates the conflict in the first place. The open nature and impartiality of mediation can clear up any miscommunications and focus on the way forward.

The Cons of Mediation

From the employer’s point of view it can convey a sense of weakness. If you immediately propose mediation out of the blue it can be seen to be undermining your confidence in using the redundancy mechanism and the employee may think that they can easily negotiate with you.

If the work is not there, the work is not there. If you mediate every single problem such as redundancy you can be adding additional cost. Organisations dealing with redundancies are looking to save cost. That said the costs of dealing with an Employment Tribunal will be a lot more expensive than using mediation, whether it succeeds or fails.

Who’s using Mediation?

In spite of it’s obvious advantages in redundancy and other conflict situations not enough companies are using mediation.

The employment relations service, ACAS, has urged small companies to consider mediation earlier when solving workplace disputes, avoiding the risk of facing employment tribunals.

A poll of 500 decision makers found that just 7% of businesses had used mediation. A further 52% believed that mediation was only suitable for larger companies. The research revealed that most managers would only use mediation as a last resort. Mediation isn’t a last ditch solution and in many cases should be the first technique considered.

The same survey suggests that respondents recognise the value of mediation, with nearly three-quarters (72%) saying mediation sounds like a good tool for resolving workplace disputes, and almost two-thirds (63%) saying that a more widespread use of mediation would reduce the number of employment tribunal claims.

Ed Sweeney, Chair of ACAS gets to core of this subject: "Resolving an issue at an early stage instead of clearing up its eventual consequences saves money, time and grief."

So if you’ve never used mediation before now might be the time to consider it. For a free mediation assessment contact Human Law Mediation.

Further reading:

Using mediation in redundancy situations

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