Delivering on Gibbons: the business case for mediation at work

Mike Emmott

CIPD Adviser, Public Policy

People and Performance Model: the influence of HR practices

Ability/skill

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Motivation/ Incentive

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Opportunity to participate

Organisation commitment

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Motivation

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Job satisfaction

Performance outcomes +

Front line management - Implementing - Enacting - Leading - Controlling

Discretionary Behaviour

Training and Development

Performance Appraisal

Career opportunity

Recruitment/ selection

Pay satisfaction

Job challenge/job autonomy

Teamworking Involvement

Communication

Job security

Work-life balance

Understanding the people and performance link (CIPD 2003)

Influence of conflict on performance

• conflict management is not visible in the model• but conflict reduces employee satisfaction and

motivation• and inhibits employee engagement• HR departments spend time “fire-fighting” and

responding to ET claims

Major causes of conflict at work

• Behaviour/conduct • Performance• Sickness absence• Attendance• Relationships between colleagues• Theft/fraud• Bullying/harassment• Sex discrimination

Managing conflict at work (CIPD 2007)

Costs for employers

• Average annual costs to employers of dealing with ET claims (excluding management time) almost £20k

• Businesses spend almost ten days on average dealing with an individual claim (including 7.7 days senior managers’ time)

• 33% of employers also report non-financial negative effects

• Average cost of defending an individual ET claim estimated around £9000 (Gibbons report)

CIPD research 2007

Costs for employees

• Adverse impact on health • Strain on relationships inside and outside the

workplace• Damage to future career prospects• Stress and depression reported in 33% of cases • Claimants spend an average of £2500 on legal

fees

Gibbons review March 2007

What are the benefits of mediation?

• Time - mediation often completed in one meeting• Legal representation optional• Confidentiality• Problem-solving approach to complaints reduces

disruption and future problems• Lower employee turnover• Fair process: parties contribute to solution• No finding of guilt or innocence• “Win-win” solution

Business benefits as seen by employers• benefit most frequently mentioned is improving

relationships between employees (83%)• reducing or eliminating the stress involved in more

formal processes (71%). • almost half of respondents (49%) see mediation as

avoiding the costs of defending employment tribunal claims

• majority of organisations that make use of mediation do so primarily for ‘soft’ or cultural reasons ie mediation is about performance not just costs

Workplace mediation: how employers do it (CIPD 2008)

Impact of mediation on ET claims

• Employers that provide mediation training receive fewer ET claims

• Average 3 claims compared with 3.5 • Marked public sector effect (4.6 claims

compared with 8.9)• Employers with 10,000+ employees report

about one quarter the number of claims if they provide mediation training

Managing conflict at work (CIPD 2007)

Employers’ use of mediation

• only 30% of employers train any employees in mediation skills

• training is more common in public services (53%) than in other sectors (manufacturing and production 15%)

• 1in 4 employers use internal mediation • 1 in 5 employers use external mediation (e.g.

ACAS)

Why don’t employers make more use of mediation?

• Cost is seen as the biggest single issue inhibiting the greater use of mediation.

• Lack of trust by employees is also an important factor referred to by 16% of respondents.

• Lack of understanding about the process (21%), lack of interest by senior management (13%) and difficulties in finding a mediator (12%) are also significant factors.

• Resistance by line managers is seen as inhibiting the use of mediation by 12% of respondents.

Gibbons agenda: more disputes to be resolved in the workplace

• repeal statutory dispute resolution procedures• produce clear, simple, non-prescriptive guidelines

on discipline and grievances• ensure “incentives to comply with new guidelines

by maintaining and expanding employment tribunals’ discretion to take into account reasonableness of behaviour and procedure when making awards and costs orders”

Other Gibbons recommendations• increase quality of advice to potential claimants

and respondents through adequately resourced helpline…

• …including as to the realities of tribunal claims and the potential benefits of alternative dispute resolution

• offer incentives to early resolution techniques by giving employment tribunals discretion to take into account the parties’ efforts to settle the dispute when making awards and costs orders

The Gibbons challenge

• “…all employer and employee organisations to commit to implementing and promoting EDR…”

• how will we recognise success? • what is the price of failure (after earlier misfires)? • what alternatives are on offer to ensure the

“effective and proportionate enforcement of rights”?• how will employment tribunals respond to the Acas

Code: how will they promote early dispute resolution?