Delivering on Gibbons: the business case for mediation at work

1. Delivering on Gibbons: the business case for mediation at work Mike Emmott CIPD Adviser, Public Policy

2. People and Performance Model: the influence of HR practices Training and Development Performance Appraisal Career opportunity Job security Recruitment/ selection Ability/skill ---------------------- Motivation/ Incentive ---------------------- Opportunity to participate Front line management - Implementing - Enacting - Leading - Controlling Organisation commitment --------------- Motivation -------------- Job satisfaction Pay satisfaction Discretionary Behaviour Performance outcomes + Work-life balance Job challenge/job autonomy Teamworking Involvement Communication Understanding the people and performance link (CIPD 2003)

3. 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

4. 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)

5. 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

6. 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

7. 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

8. 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)

9. 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)

10. 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)

11. 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.

12. 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”

13. 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

14. 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?