Human Law Ezine - November 2010
Can Mediation Save the Public Sector?
A recent survey of public sector leaders published from Zurich Municipal illustrates the potential legal costs that may result from the huge cost-cutting exercise now under way across the whole public sector. It seems almost inevitable that conflict and costly legal battles over unfair dismissal, wrongful dismissal and redundancy disputes will ensue.
Let’s explore some of the dilemmas faced by managers and human resource departments as they seek to save costs, and consider how mediation might have a role to play.
1. Using redundancies to save costs
Any organisation making people redundant has to follow a legal process including consultation. Failure to do so will leave you exposed to legal claims from staff over the unfairness of it all.
It’s not uncommon for redundancies to lead to unrelated legal actions from disgruntled staff, these can manifest themselves as grievance claims connected with bullying, for example.
With some solicitors and firms offering no win/ no fee many staff have free access to legal resources to launch a claim for compensation. What have they got to lose?
2. Reducing terms and conditions to save costs
Reducing salary, stopping pay rises and changing pension benefits are all being considered by public sector employers in order to meet their budget reduction requirements.
But it’s not a simple process and can lead to conflict with staff. It’s also questionable legally as one needs the active agreement of employees before changing their terms and conditions.
Getting agreement won’t be easy and could again leave you open to claims of harassment and bullying unless handled very carefully. Already trade unions are threatening strike action over their members being offered inferior working terms and conditions. Is this even a real option?
3. Restructure and retrench to save cost
Trying to achieve the same outputs and productivity from fewer people might be necessary. As a manager you have to get things done. But before long anger and resentment sets in, which can lead to potential legal claims and a rise in sickness absence.
A recent report by the Chartered Institute of Personnel and Development, looking at stress-related absence has shown that stress has increased over the past year and is the main cause for persistently high levels of long-term public sector absence. Amongst those surveyed more than a third noted an increase in mental health problems such as anxiety and depression – a big rise on last year’s survey when one-fifth reported an increase. However, only one-fifth of organisations had increased their focus on employee well-being and health promotion, suggesting more could be done. The same survey found that average absence was three days higher in the public sector than in private sector services, at 9.6 days per employee compared with 6.6 days. With staff feeling fearful for their job, this may lead to staff taking more time off and leading to more costs to the organisation.
What can be done to minimise these potential disputes and tribunal claims?
- Be upfront in what you are doing
Generally when you communicate convey that you are competent, have a plan for what you are doing and that you will try to deal with everything as a quickly as possible.
- Provide a message of hope
Organisations going through change and downsizing can be a depressing place to work. It is critical that through this management conveys some message of hope even if it means that all staff will be treated with dignity and everything will be done to find the best possible outcome for those staff that will leave.
- Give training to those on the front line
Conflict resolution skills and training staff to manage sickness absence are skills worth training in. Training managers and HR personnel in mediation skills can enable organisations to eliminate low level problems which can become big later. These are inexpensive ways of resolving disputes quickly.
- Be legal
Try your best to follow a process. For example, when you embark on a redundancy process you need to plan it, engage in a genuine consultation and then if need be make staff redundant, together with offering a right of appeal. Many organisations do not necessarily respect the law when the engage in a process such as redundancy and make themselves legally vulnerable.
- Use mediation proactively
Train all managers in basic mediation skills. You’ll find them using these skills on a daily basis with members of their team to resolve conflicts as well as with external suppliers and customers, which can have the added bonus of reducing commercial disputes too.
Have mediation clauses embedded within grievance and disciplinary procedures. Make people aware of mediation as an option in disputes. This will make it more likely that mediation will be used and gives greater chance for the dispute being settled.
Try everything possible to prevent major conflict occurring and when disputes are inevitable manage them effectively, using the people with the right skills to ‘go legal’ when necessary but look to negotiate where this will deliver a more timely and cost effective resolution for all.
It’s not going to be easy for the public sector over the coming months, or even years, but I firmly believe that taking an approach which embraces the skills and principles of mediation – in terms of how people are managed and how disputes are handled – will pay dividends.
For advice on implementing a mediation scheme or details of in-house mediation training courses from Human Law Mediation contact Justin Patten here.