ALTERNATE DISPUTE RESOLUTION

Types of ADR available

Negotiation

Mediation / Conciliation

Arbitration

Negotiation

Parties come together informally.

With or without their lawyers.

They attempt to resolve their dispute.

No neutral third party involved.

Often parties must compromise for the

negotiation to succeed.

Conciliation

Third party assists parties in reconciling differences

Conciliators, do no recommend solutions

Mediation

Goals: To get the disputants to listen to each other. To get them to arrive at a fair and equitable solution to their

dispute. Mediator makes no final decision, but does suggest solutions.

A facilitator of communication between the parties. If solution reached, usually reduced to a written contract. What was said at the mediation is confidential. Common uses:

Collective bargaining disputes. Insurance claims. Environmental disputes.

Arbitration

Resolution of a dispute by a neutral third party(s) Arbitrator not constrained by precedent, as is a

judge. Much more likely to reach a compromise solution.

Award is legally binding. Cannot be appealed except for:

Fraud, corruption, bias. Procedural errors that prejudice the rights of a

party The arbitrator exceeding his/her authority.

Advantages of ADR over Litigation Less expensive

Less time consuming

Parties can choose the person who will preside

Might prevent adverse publicity

Preserve confidentiality

Serves to preserve relationship between the

parties

Problems with Arbitration

Unpredictable: Not required to follow previous cases Lack of legal training of some arbitrators. Absence of written opinions. No standard rules to follow No Discovery Limited or no appeal

Fed. Arb. Act. Sec. 10 (page 111) Corruption, fraud or other undue means Arbitrator exhibited bias or corruption Refusal to postpone hearing, hear evidence Arbitrator exceeded his/her powers

Methods of securing Arbitration

Binding arbitration clause in contract. More than 95% of collective bargaining

agreements have such clauses. Statute Submission agreement.

A written contract Can be entered into at any time. Usually specifies:

How the arbitrator will be selected. The nature of the dispute. Constraints on the arbitrator’s authority. Place and time for the arbitration hearing.

Court-annexed ADR

Purpose: to reduce the number of litigated cases.

Some states make it mandatory.

Usually for cases involving less than a set dollar

limit.

If mandatory, then non-binding.

Can still go to court for a full trial.

But might have to pay some costs to do so.

Rules of evidence usually same as in litigation.

6-11

International Dimensions of ADR

ADR is highly favored internationally.

New York Convention

Makes arbitrators’ awards enforceable

in losing party’s country.

U.S. policy favors arbitration of

international disputes.

NEGOTIATION

TWO TYPES OF NEGOTIATION

1.Distributive (Competitive) Parties have different and independent goals

fixed-sum win-lose positional

NEGOTIATION

Integrative (Collaborative)Parties work together toward common or

compatible

goalResolution of conflict

Advancement of shared vision

Recognize Interdependence

Deal constructively with difference

Joint ownership of resolution

NEGOTIATION

Distributive Integrative

Soft Hard Problem solvingAvoid conflict Win Solve the problem

Friends adversaries Professionals

Change easily Dig in Focus on interests

Concede easily Concede Don’t concede ?

---------- stubbornly Invent options

NEGOTIATION

Soft Hard Problem SolvingAvoid contest Win contest Use standards

of will of will

Make Demand Separate people

concessions concessions and problem

Back downMake threats Know others walkaway

Commit early Commit early Draft as you go

draft late draft late commit at end

Integrative Negotiation

Bargain Over Interests Not Positions

Separate People From the Problem

Generate Options Before Deciding

Base Results On Objective Criteria

POSITIONS / INTERESST

POSITIONS INTERESTSThings you say Underlying

you want Motivations

Demands Needs and Concerns

What you will Fears and Aspirationsor won’t do

DISCOVERING INTERESTS

Look behind positions for underlying reason

Put yourself in other person’s shoes

Ask : “Why?”

Ask “Why not? What would be wrong with…”

PERCEPTUAL DISTORTION

A Stereotyping Assigning attributes based on membership in a

particular group

B. Halo effects Generalize on a number of attributes based on

knowledge of one attribute.

C. Selective perception Accepting information that supports prior belief and

filtering out nonconforming information

PERCEPTUAL DISTORTION

D. Projection Ascribing to others the characteristics you

have Assuming that the other party will respond in

the same manner you would respond.

E. Framing Subjective evaluation mechanisms to

determine whether to pursue or avoid future actions

Framing

A large car manufacturer is suffering significant financial losses. As a result plants need to be closed and 6000 employees laid off. Four proposals have been developed. You must select one of the plans.

Plan A. This plan will save one of the three plants and 2000 jobs.

Plan B. This plan has a 1/3 probability of saving all three plants and all 6,000 jobs, but has a 2/3 probability of saving no plants and no jobs.

Framing

A large car manufacturer is suffering significant financial losses. As a result plants need to be closed and 6000 employees laid off. Four proposals have been developed. You must select one of the plans.

Plan C. This plan will close 2 of the 3 plants and lose 4000 jobs.

Plan D. This plan has a 2/3 probability of closing all three plants and losing all 6000 jobs and a 1/3 probability of closing no plants and losing not jobs.

A large car manufacturer is suffering significant financial losses. As a result plants need to be closed and 6000 employees laid off. Four proposals have been developed. You must select one of the plans.

Plan A. This plan will save one of the three plants and 2000 jobs.

Plan B. This plan has a 1/3 probability of saving all three plants and all 6,000 jobs, but has a 2/3 probability of saving no plants and no jobs.

Plan C. This plan will close 2 of the 3 plants and lose 4000 jobs.

Plan D. This plan has a 2/3 probability of closing all three plants and losing all 6000 jobs and a 1/3 probability of closing no plants and losing not jobs.

Relationships

A. The norm of reciprocity Duties owned to one another because of prior

actions. Reciprocity traps

B. The similarity principle We assume others like us act like us