When Workplace Conflict Escalates: Using Mediation And Arbitration To Resolve Labor And Employment Disputes (Podcast)

In this episode of the JAMS podcast, JAMS neutrals Hon. William E. Smith (Ret.) and Paul Garrison, Esq. explore how labor and employment disputes develop, what causes workplace disagreements to escalate and how parties can use mediation, arbitration and early intervention strategies to resolve conflict more effectively. Drawing on their experience in the federal judiciary, corporate legal departments and labor relations, they discuss why clear communication, procedural fairness and trust are often critical to preventing disputes from becoming more entrenched. 

The neutrals explain that workplace conflict is shaped not only by policies and procedures, but also by how those policies are communicated, implemented and understood by the people affected by them. They share practical insights into when mediation may be productive, when arbitration may be necessary and how parties can think strategically about the right dispute resolution tool at the right time. Throughout the conversation, they examine:

• The pressure points that often lead labor and employment disputes to escalate, including perceived unfairness, unclear policies and communication breakdowns
• How mediation can provide flexibility and creative solutions before parties become too entrenched in their positions
• When arbitration, med-arb or early neutral involvement may be appropriate and what safeguards parties should consider

This episode provides practical guidance for employers, employees, unions and counsel navigating workplace conflict, emphasizing the importance of integrity, communication and trust in resolving disputes efficiently and fairly.

Transcript

Moderator (00:00:00): Welcome to this podcast from JAMS. In this episode, we're talking about how labor and employment disputes develop, the conditions that lead workplace disagreements to escalate into formal proceedings and how parties can use mediation, arbitration and early intervention strategies to resolve conflict more effectively. With us are two JAMS neutrals, Judge William Smith, who served more than 23 years on the federal bench for the U.S. District Court of Rhode Island, including six years as chief judge, and Paul Garrison, who prior to becoming an ADR professional, served as a senior executive and attorney for large companies for 18 years, including 12 at Wells Fargo. Paul, Judge Smith, welcome to the podcast.

Paul Garrison (00:00:51): Thank you.

Judge Smith (00:00:51): Thanks. Nice to be here.

Moderator (00:00:53): Judge Smith, what influences do you think have made the labor and employment landscape more fraught over the last few decades?

Judge Smith (00:01:02): So, in recent years, I think there's been a well-meaning, good faith tendency to try to soften the workplace relationship, make it more collaborative, more oriented toward teamwork and more positive. And I think all of that is generally speaking a good thing. But there is a bit of a downside to it, it seems to me, because in the course of doing that I think sometimes the documentation and the expression of, for example, disciplinary action is sometimes couched in language that can be confusing. Just to give a couple examples: instead of talking about an employee's deficiencies or shortcomings, documentation might talk about opportunities, and vernacular of performance improvement plans seems to be ubiquitous now as opposed to disciplinary forms or second step of the disciplinary process or suspensions or final warnings. And I don't mean to sound like a dinosaur and I'm not looking back and saying, "Oh, the good old days," and so forth. I think there's a lot to be said for these developments, but there was a kind of clarity to the previous way of doing things. So, for example, if somebody got a final warning, everybody knew that it was really a final warning. If there was one more violation of the procedure or the policy, it would lead to a termination. That was all very clear. So, couching things in this kind of positive, forward-looking language, while it has a lot of benefits, it needs to be managed correctly. Employers need to be clear about what they're telling employees about whatever the situation may be. If the job is in jeopardy, that needs to be clearly expressed, and it needs to be clearly understood by the employee…what the expectations are, what he or she has to do in order to turn things around.

Moderator (00:03:26): Paul?

Paul Garrison (00:03:28): The problem is contextual, okay? I think there's some organizations that go too far in one direction or the other, and I think depending upon what the issue is, companies can be very traditional in some regard, and some are just having the best practice or the most trendy language that they're not really giving thought to what Judge Smith was saying, are we really communicating effectively with our workforce? Ultimately, I think that's what we want to do. So, I think this can be very contextual and something that needs to be thought through depending upon the nature of what the dispute is.

Judge Smith (00:04:07): Totally agree with that. Employers – it's not a one size fits all. Employers come in all sorts of different shapes and sizes and styles. Everything from a manufacturing company that's been around for 150 years making the same product in the same way with the same policies and procedures and begrudgingly adapting to each new federal or state law that gets enacted all the way to an ultra-modern hip kind of workforce that has very little in the way of structure and operates in a very non-hierarchical fashion.

Moderator (00:04:59): Paul, when you look at these labor and employment disputes before they become formal proceedings, what are the pressure points that most often lead to conflict?

Paul Garrison (00:05:10): Usually there's some workplace friction that derives from some perception that there's been some unfairness. That may be because of the perception that a policy is unclear or that it's unfair in its implementation, even if it's neutrally fair on its face. Or someone feels that they've been unfairly disciplined or there's been some kind of communication breakdown between, say, labor and management. Usually behind every formalized grievance or conflict, long before that was a perception or a reality that falls into one of those buckets.

Moderator (00:05:58): Judge Smith, how much of the conflict comes from the policy itself as Paul referred to, versus how the policy is communicated, applied or even understood by the workers affected by it?

Judge Smith (00:06:11): Every set of policies has to be implemented by real people, and real people often have different kinds of issues that arise between them. So, on one level there's the power dynamic that exists between an employer and its representatives supervisors, managers, executives and the employees that they are supervising and working with. So, that power dynamic can sometimes lead to the friction that Paul referred to. And then there is the communication dynamic that exists in every human relationship and certainly exists every day, all day long in the workplace. And so, if the power dynamic is not being managed well, if communication skills are less than they should be, then policies that may not be perfect but aren't necessarily a major problem can mushroom into a major problem. So, in my view it's a combination of not just the policies that are on the written page, but really the implementation of those things in the very human environment of a workplace.

Moderator (00:07:36): And Paul, I want to ask you a little bit about the labor disagreements that you've specialized in over your career. What are the kind of early warning signs that a dispute is cooking?

Paul Garrison (00:07:52): The first sign of it is usually there's a complaint to a supervisor or to a union steward. And if that union rep believes there's sufficient weight and muster to the complaint, they may in fact file a grievance. And then the grievance follows a procedure that's usually outlined in the collective bargaining agreement between labor and management for that particular enterprise. So, that's how it usually gets started. And what happens is it goes through that procedure, and then at the end of it, if the parties reach an impasse, it will outline what the dispute resolution mechanism might be. Usually, that's arbitration in the labor context. Sometimes it could be a combination of mediation prior to arbitration, but that will be a process that's outlined for the parties to follow, and that's a contractual obligation that both parties have to follow and then, and to participate in good faith.

Moderator (00:09:00): Are there opportunities to use other kinds of mechanisms like early mediation? How do you know which ADR tool to use at the right time?

Paul Garrison (00:09:12): The contract usually is what they abide by, the collective bargaining agreement, and that's usually what they do. But the parties at any point usually have some latitude, as long as there's mutual agreement, to try something. So, say for example, if a contract doesn't spell out mediation but the parties choose to do that, they certainly could mutually agree to mediate, and then ultimately if the mediation fails, they could go back to arbitration. It can be additive as long as they're not taking away an opportunity for due process to occur. So, I think it's a great chance for an opportunity that should be exploited for the parties to be creative if they can in resolving disputes. That's the ultimate goal, to try to resolve disputes efficiently and without having to go to court, where it can be time-consuming. And that's why you might have a collective bargaining agreement with a dispute resolution process that's outlined. But within that, to your question ... you can be flexible in how you approach resolving those disputes.

Moderator (00:10:26): And Judge Smith I understand you no doubt have seen some CBAs come to your courtroom where you had to evaluate those agreements. But how would you say parties should evaluate whether mediation is likely to be productive? Because it's this art to knowing when it's possible to work and when the parties are just too dug in.

Judge Smith (00:10:54): I think mediation is always worth considering as an option to resolving disputes, and it's true that sometimes it won't be the vehicle that gets you to a resolution. But I think it's a very rare case where you don't want to consider trying to work a matter out in a mediation as opposed to arbitration. One of the main reasons for that is that mediation gives you a wide variety of potential solutions to the problem that has manifested itself into a formal grievance and a potential arbitration, whereas an arbitration is a bit more coming to trial in court where it's a binary problem. One side is going to win; the other side is going to lose. Arbitration provides a little more flexibility to the decision maker than, let's say, a jury trial or even a bench trial in court. But it doesn't give the parties anywhere near the kind of flexibility that they get by engaging in a mediation process, which allows for a lot more give and take and a lot more creativity in trying to get to the root of the problem, and then come up with sometimes a creative solution to the problem that serves both parties' interests.

Moderator: (00:12:24): Paul, Judge Smith talked about the creativity. How have you seen that manifested in some of these mediations before? Why are parties just sometimes just not open to that? And what causes that?

Paul Garrison (00:12:38): I think that mediation is often not effective because sometimes it could be too early in the process, and sometimes it's because you don't have information. And sometimes mediation is not effective because the counsel for the company or the union rep has spent so much time talking about how they're going to win at arbitration or how they would win in court, (hypothetically) that they're not really spending the time with their respective clients to think about how do I educate my client that I'm representing on kind of the beauty of the mediation process that really isn't about winning, it's about having an opportunity to share in that resolution of what that outcome is going to look like. So, it's very different than an adversarial setting like arbitration.

Moderator (00:13:43): But Judge Smith it's really important for lawyers to enlist the mediator, right? To get the most out of it. It's the smart lawyers who understand that the mediator can be a real strength in the process.

Judge Smith: (00:14:00): I think the best, most experienced lawyers these days, and I think this has changed over the years or over the decades, I would say are thinking about mediation right from the beginning. Because experienced lawyers know that 98% of cases, civil cases filed in the United States are settled outside of court. They're either resolved on dispositive motions or they're settled, and the vast majority are settled. And so, lawyers are thinking about, good lawyers are thinking about that right from the beginning. And the question is, when do you make that move to try to engage in mediation?

Moderator: (00:14:49): Hey, Paul, when parties do reach a point when a binding decision is needed rather than just another opportunity to negotiate, is that self-evident? Or when do you know when that point has come?

Paul Garrison (00:15:06): Usually you know when, if you have tried mediation, it, that it failed. And maybe even before mediation, you've had some informal discussions, which I would encourage the parties to do. Oftentimes, disputes don't get resolved simply because people aren't talking to each other, and to the extent they're listening to argue their points and not to understand the other party's point of view. But assuming you've had some informal discussions, you've had mediation, and perhaps that failed or it did fail, now you're looking for some finality. And I think you're looking for a decision-maker. You can't resolve it amongst yourselves. That's when I think that arbitration's perfect. You've done the leg work leading up to that, and now it's time to resolve the dispute. It can't go on forever. I always point out to people that the company's in business of making widgets, for example. It's not in business just to go to arbitration or to court or wherever the case may be, and the employees are there to do a job. And so, it shouldn't go on forever and a lot of these disputes go on longer than they should. I'm of the personal belief that most disputes should be resolved without court intervention or even without arbitration. They just don't rise to that level if people talk to them. But if they've done all those things that are necessary and they can't reach an agreement, sometimes that happens. Going to arbitration is a wonderful way to get a dispute resolved. I really believe in the process, that it's a fair process, it's an efficient process, more often than not, and you get a good arbitrator everybody can walk away feeling that they had a chance to be heard and put their best arguments forward.

Moderator (00:17:04): Judge Smith, what do you think about the same neutral who mediated the dispute also serving as an arbitrator to that dispute? What safeguards should parties consider before allowing that to happen if so?

Judge Smith (00:17:19): I think it has great potential because it has the benefit of being more efficient. But there are some guardrails that have to be in place in order to keep the process as clean and sound as we all want. First, the parties need to consent to that process, and it has to be a mutual consent that they would engage the same neutral to do both a mediation, then an arbitration if the process fails. And the parties need to in my view, and this is how we would do it in the courts, they need to understand that there's always the possibility that a neutral is going to learn something in the course of a mediation that would lead him or her to conclude that they cannot be a fair and unbiased factfinder in the case. And if that occurs, for whatever reason the neutral will be ethically obligated to withdraw from the case and there would need to be a different neutral who would try the arbitration.

Moderator (00:18:41): Paul, why don't you lay out the case for mediating, arbitrating the same matter?

Paul Garrison (00:18:50): Yes. To me, the obvious pro of a med-arb is that it gives, again, the parties the opportunity to try to have a stake in the outcome of resolving the dispute that you wouldn't have if you're going to, say, arbitration, where now you've got a fact-finder who's going to make a decision, and going to assign fault, and going to fashion a remedy without input from either party other than what they have contributed in terms of evidence in the proceeding itself. But they're going to independently evaluate that. And so, the med-arb gives the parties an opportunity before they go into arbitration to have a stake in the outcome and to have a say about how the dispute could be resolved. That's an obvious one to me, and I think that's a very weighty concern. So, I think med-arb is fine. Another thing is that if you don't resolve it in mediation, you then have the arbitrators already educated as to what the case is all about, the strengths and the weaknesses.

Moderator (00:19:58): How do the parties understand when each phase in ADR is needed, or what kind of tool is necessary?

Paul Garrison (00:20:06): I don't know that the parties often know. I think that it's unfortunately, it depends upon how much experience and expertise the parties and their representatives have. I think it's typically known that mediation is something to try first because arbitration by its very nature is final, and oftentimes it's in the contract whether it's going to be final and binding. Now, exactly when you'll know which one and what to do and when, I think it depends upon the nature of the dispute, and the parties and their representatives involved and what they're hoping to obtain as an outcome. So, I think there are some variables there that would indicate which might be the best tool to use, but it's not always clear, particularly at the beginning. I would think that you would start with the tools that allow the parties to have input and to fashion a remedy. So, I think things like mediation, early neutral evaluation, those are the things that before the parties become too – “have their feet in concrete” – too hardened in their positions, you want to use those tools that give them the flexibility to have input and say before you go to a more binding type of proceeding like arbitration typically is.

Judge Smith (00:21:46): Maybe I could jump in on that just for a moment. I agree with everything Paul said. Some of this will depend on what kind of working relationship the lawyers, or in the case of a collective bargaining relationship managers and union stewards or union representatives, what kind of working relationship do they have? If they've worked together really well and they've worked together for a long time, they may have really good instincts about whether something needs to go directly to arbitration or is better suited for mediation or perhaps is a Med-Arb situation. But if the parties haven't worked together very much or the attorneys don't know each other and don't trust each other a lot that's when it can be a little bit difficult because sometimes people worry about showing signs of weakness by suggesting, for example, mediation. And I think it could be a good idea to engage a neutral even though you're not sure about which path is right for you. It can be very effective as a collaborative process to have the neutral help the parties or the attorneys think through what's the right way to go about this situation. Should we do a mediation? Should we go straight to arbitration? Or would a Med-Arb process suit this situation well? And in that collaborative dialogue, sometimes you can build the trust and have the kind of exchange that leads you, I think to the path that's correct for that situation.

Moderator (00:23:28): Paul and Judge Smith, thank you so much for your time. I think it's been really helpful for our listeners. If I could ask you just one last question, though. Both of you, I think, have been talking about ways to make the process more efficient and create trust, and so you both have touched on this, but if there is one thing parties should do to avoid the unnecessary escalation. Some disputes are just naturally going to escalate probably. But is there something they can do to avoid that unnecessary escalation and create that trust? Judge Smith?

Judge Smith (00:24:09): In the labor relations field where I practiced for 15 years before becoming a judge – and I know Paul has spent a whole career in this field as well – anyone who practices successfully in that field knows that integrity, your word is your bond. That is the key thing to a successful relationship within union management or really any employment situation. So, developing practices and procedures that are consistent and honest and communicating effectively and honestly with people. And this sounds like such obvious things you learn in elementary school. But it really is true. If you tell somebody you're going to do something, then actually do it. And then if you make a commitment to keep it. And so, operating with a kind of unwavering level of honesty and integrity with your counterparts on the other side and building the kind of trust that we've been referring to throughout, I think that is the most important element. And then communication and as part of communication, really learning how to listen effectively. A lot of people they got to make their points, and they don't really listen to the other side and that's why neutrals, that's why we do what we do and why people need us sometimes is to help them do that. But those are the two things that sort of jump to my mind.

Moderator (00:26:20): Listening and integrity. Paul?

Paul Garrison (00:26:23): I think that Judge Smith answered that perfectly. I agree that it really is about integrity and operating in good faith, and that means, for example, in a labor context, that you're forthcoming with information. The company's not hiding documents or hiding the ball or suppressing anything. The grievant is approaching whatever forum you're in mediation, arbitration, with transparency and accountability and acknowledging what they may or may not have done right or wrong. And so that's how I think you approach it with integrity if you're both operating as a practical matter. It's one thing to say it, it's another thing to do it and that's what starts you on that path to building the trust that Judge Smith just alluded to. So, I think those are key as well, so I would second what he just said. Perfect.

Moderator (00:27:31): All right. We'll end on agreement. Judge Smith, Paul, thank you so much.

Judge Smith (00:27:38): Thank you.

Paul Garrison (00:27:38): You’re welcome. Glad to be a part of this discussion.

Moderator (00:27:43): You've been listening to a podcast from JAMS, the world's premier alternative dispute resolution provider. Our guests have been Judge William Smith and Paul Garrison. For more information about JAMS, please visit www.JAMSadr.com. Thank you for listening to this podcast from JAMS.

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