Employment Conflict 1

Running head: EMPLOYMENT CONFLICT MANAGEMENT

Employment Conflict Management

Terri P. Gilbert

University of Phoenix
 Employment Conflict 2

Employment Conflict Management

The United States is in the middle of a recession, affecting businesses decline in sales and

financial losses. Companies are restructuring and resorting to use of advanced technology to

meet customer demand, and in the process, many roles of employees are being automated. The

reliance on advance technology has led to employee termination of redundant and non-critical

skills. According to Anderson (2003), employers have inclusive rights to layoff employees, but

at the same time are vulnerable to employment lawsuits.

FastServe is a $25 million dollar sport apparel company and has decided to eliminate the

online websites that did not produce a viable investment (University of Phoenix Simulation,

2009). The senior manager in human resources has to terminate three employees. The three

employees chosen qualify under classified discrimination laws (University of Phoenix

Simulation, 2009). FastServe management’s termination of the protected class of employees has

to be addressed and handled right the first time to minimize and avoid potential legal liability

(University of Phoenix, 2009). The company has the opportunity to use Alternative Dispute

Resolution (ADR) techniques to resolve conflicts, implement an organized layoff plan, and

mitigate the risks to reduce the possibility of the conflict escalating into an employment lawsuit.

Potential Conflict Identifications

FastServe is a sport apparel company and the primary customer base is the Generation Y

population. To increase profits, 3-D ‘drape-n-see’ mannequin websites were installed. The

websites mechanism was cumbersome and did not attract enough buyers. FastServe decided to

eliminate the websites, which prompted the need to downsize. The senior manager of human

resources decided to terminate three employees, Sarah Boyd, Jenny Mills, and Brian Carter. The

three employees’ job performance and value to the company were assessed, and management
 Employment Conflict 3

determined the employee’s skills were either redundant or non-critical. The employees fall under

protected discrimination classes regulated by federal employment laws, and state

antidiscrimination laws not in conflict with federal law (Reed, Shedd, Morehead, & Corley

(2005).

Sarah Boyd is an average 53-year old dispatch clerk and her position is to be automated

resulting in her skills being redundant (University of Phoenix Simulation, 2009). Boyd’s age puts

her under the protection of the Age Discrimination Employment Act (ADEA). ADEA prohibits

discrimination against employees 40 years or older, and prohibits mandatory retirement for this

protected class (University of Phoenix e-Resource, 2009). Sarah is not under contract with

FastServe.

Jennifer Mills is an average Call Center executive and handles customer inquires and

troubleshoots problems (University of Phoenix Simulation, 2009). Mills is five months pregnant

and FastServe management has decided to lay her off because she has non-critical skills

(University of Phoenix Simulation, 2009). Under the Pregnancy Discrimination Act, an

amendment of the Civil Rights Act in 1978, an employer cannot force a pregnant woman to stop

working until her baby is born, provided she is capable of performing her duties properly (Reed

et al., 2005). Jennifer is under contract with FastServe.

Brian Carter is the last employee considered for termination. Carter is an average

programmer responsible for the 3-D ‘drape-n-see’ mannequins’ websites (University of Phoenix

Simulation, 2009). Carter’s recent diagnose of with carpal tunnel syndrome because of excessive

strain on his wrist places him under the protection under the American Disabilities Act (ADA)

(University of Phoenix Simulation, 2009). The American Disabilities Act (ADA) forbids

employment discrimination against job applications or employees with a physical or mental

 Employment Conflict 4

impairment that significantly constrains activities whether a past or current impairment (Reed et

al., 2005). FastServe management has decided to layoff Brain for his skills are not critical with

the elimination of the online distribution services (University of Phoenix Simulation, 2009).

Brian Carter is under contract with FastServe. The employees facing termination are protected by

federal and state laws and to reduce court litigation, FastServe should consider using Alternative

Dispute Resolution (ADR) methods. ADR has techniques available to intercede on behalf of a

company in a termination dispute. The techniques can be used to reach an amicable agreement to

avoid costly and timely court proceedings.

Alternative Dispute Resolution Techniques/Risk Reduction

The outlook in organizations of foreseeable conflict requires the development of conflict

resolution strategies (Ray, 2008). Businesses are investing in designing conflict resolution

systems to improve their ability to handle conflict to avoid lawsuits (Ray, 2008). The Alternative

Dispute Resolution (ADR) techniques are widely implemented by industry to dispense quickly

with many types of organizational disputes (Ray, 2008). According to Mose and Kleiner (1999),

ADR “… is any method of resolving any dispute that does not require the ultimate decision to be

made formally by a judge or jury” (p. 54). ADR methods can be used as single or combined

techniques in conflict management. An example of a company using a mix of ADR techniques

is Zurich Financial Services. Zurich Financial Services used a three step ADR system to settle

difficult insurance claims from Hurricanes Katrina and Rita in 2005; and Hurricanes Ike and

Gustav in 2008 (Zurich North America, 2009).

Zurich Financial Services used a combination of resolution meeting, nonbinding

mediation, and arbitration to settle complex insurance claims instead of using the company’s

normal process to adjust catastrophe claims (Zurich North America, 2009). The first step was a
 Employment Conflict 5

resolution meeting to resolve issues prolonging the payment and closing of policyholder’s claim;

next was a mediation process that was voluntary and not binding; and if the first two had not

resolved the conflict, an agree upon arbitrator by Zurich Financial Services and the policyholder

render a final decision (Zurich North America, 2009). However, Zurich successfully resolved

98.2% of the policyholder’s disputes in the first stage (the resolution meeting) that eliminated

potential lawsuits (Zurich North America, 2009). FastServe should consider a similar method,

slightly modified, using the resolution meeting and a third party as the negotiator.

FastServe faces the possibility of employment lawsuits pending the termination of three

employees protected under federal employment law. A resolution meeting should be the first

step. However, in lieu of potential litigation, the senior manager of human resources should

consult with the company’s general counsel to determine the two employees with contracts fall

into the category of non-binding employment-at-will contracts. Employment-at-will doctrine is

“… an employer can discharge a employee without having to cite justification because there is

no reason needed … [unless extenuating] exceptions to the doctrine [which includes] … an

expressed contract, implied expression, covenant of good faith and fair deal, implied contract,

public policy or statutory prohibition” (University of Phoenix, eResource, 2009, p. 1-2). After

verifying that the three employees have no legal stance, the senior manager of human resources

should provide a three-way resolution meeting. The meeting would include the employee,

supervisor and the third party negotiating the conflict.

The senior manager of human resource will be the third party to negotiate the conflict of

interests in the termination of the employees. According to Wilmot and Hocker (2007),

“Negotiation occurs in conflict resolution when the parties recognize their

interdependence, have been able to establish their concerns, are willing to
work on both incompatible and overlapping goals, have been able to establish
enough power balance so people can ‘come to the table,’ and when the
 Employment Conflict 6

procedures are in place so people can talk to each other in a problem-solving

way” (p. 244).

FastServe management has decided to use an informal resolution meeting negotiated by a

third party (human resources) to work out an amicable agreement with each employee facing

termination. Conflict can be resolved in a formal or informal setting controlled by a third party

(Dana, 2001). The three-way meeting’s objective is to allow a negotiator control the meeting to

reach a collaborative agreement between all parties. The negotiation will be an integrative

approach to identify mutual interest so that the negotiation process allows all parties to gain

some interests (Wilmot and Hacker, 2007).

Collaborative negotiating is a key component in employment conflict resolution that

assumes “… creativity can transcend the win/lose aspect of competitive negotiations” (Wilmot &

Hocker, 2007, p. 253). A successful resolution meeting needs a skilled negotiator. The senior

manager of human resources at FastServe conflict resolution skills need to include “…a

developed repertoire of communication skills that are learned, refined and practiced” (Wilmot &

Hocker, 2007, p. 8). The senior manager should have the ability of understanding the perception

of the parties involved to clarify the substantive issue apart from individual emotions (Wilmot &

Hocker, 2007). The negotiation requires reflective listening and assertive skills (Wilmot &

Hocker, 2004).

To be able to negotiate an amicable settlement with the employees to be terminated, the

third party must be able to control the meeting and prevent destructive conflict such as escalatory

spirals or avoidance spirals and especially the “four horsemen of the apocalypse (criticizing,

defensiveness, stonewalling, and contempt)” for people have a tendency to use defensive

communication and save face to protect themselves against a situation that will change their way

of living (Wilmot & Hocker, 2007, p. 13-18). As the negotiator, the key mechanism to solving
 Employment Conflict 7

the problem is to seek what is the mutual interest of the parties. According to Professor E.

Wertheim of Northeastern University (2002), “… it is important to define the problem in a way

that is mutually acceptable to both sides … [and] involves depersonalizing the problem so as not

to raise the defensiveness of the other person” (p. 5). According to Mose and Kleiner (1999),

“Negotiation, although informal, is the simplest form of ADR … adversaries meet to discuss

their differences and work toward resolution … negation may take place at any point during a

dispute” (p. 54). The “back and forth use of reflective listening and assertion skills” allows the

parties to work toward a joint resolution … “[built] on the ideas of both parties and address all

concerns” (Wilmot & Hocker, 2007, p. 252). Once there is a breakthrough, the parties should be

in agreement and details of the severance package and outplacement support should be addressed

and agreed upon. In case the employees are not in agreement, arbitration should be considered.

Arbitration, the last resort to avoid court litigation, allows a neutral third party to render a final

decision to solve the conflict (Wilmot & Hocker, 2007).

Implementation Plan for Alternative(s)

Before the implementation of the mediation and negotiation by the senior manager of

human resources in individual meetings with each employee and the supervisor, prior planning

of the layoffs is mandated. Determining the employees’ termination date, severance package and

outplacement support should be eight weeks earlier, and the senior manager of human resources

needs to be involved in all planning phases (DAS-HRE Iowa Government, 2009). A proposed

plan to initiate the proposed layoffs should be submitted to human resources and allowed a week

for approval (DAS-HRE Iowa Government, 2009). Severance packages and outplacement

support should be prepared prior to the resolution meeting. An employee’s termination package

is expands the pie that “encourages the collaborative outcomes because most conflicts are based
 Employment Conflict 8

on the perception of scarce resources; expanding the resources alters the structure of the conflict”

(Wilmot and Hocker, 2007, p. 255).

The senior manager of human resources should be the third party and control the

resolution meeting. The meeting accommodation should be conducted in a private area to avoid

distractions (Wilmot & Hocker, 2009). Three individual meetings should be schedule. Each

meeting should include the employee, supervisor, and the senior manager of human resource.

The meetings should begin by week 10. If the resolution meeting ends the conflict because the

employee accepts the conditions termination in an amicable manner, no further ADR methods

are necessary. If any of the employees are not in agreement, arbitration needs consideration to

avoid expensive court litigation.

Recommended Metrics

FastServe has chosen to use the resolution meeting and have the senior manager of

human resource be the third party controlling the employee and supervisor individual meetings.

An implementation plan has been outlined, but there are risks that need to be mitigated if the

negotiation does not provide a win-win solution. In the event the resolution meeting is not

successful and the employee decides bypass arbitration and file an employment lawsuit,

FastServe management should prepare adequate documentation of the job descriptions,

personnel protocols and employees files, called paper fortress, that include evidence of the

reason for termination (Reed, et al., 2005).

Documentation is a key defense for a company to show evidence of why the job positions

have developed into a redundant and non-critical status. The documents explain the employees

job requirements, employee’s performance and productivity, and other pertinent information

resulting in employee termination. Documentation justifies a company’s decision to terminate

 Employment Conflict 9

class protected and non-committal contracts when downsizing is necessary. The senior manager

of human resources should have the company’s attorney go over the documentation to make sure

no discrimination is evident and the employee contracts do not have a specific date of release and

can fall into the category of employment-at- will. Prior investigation of termination of

employees should include: 1) determining if an employee falls under a protected discrimination

class; and 2) would the termination violate any federal or state employment laws. Employment

conflict management analyzes and attempts to resolve issues to avoid legal risks.

Conclusion

Workforce reduction places a company in a vulnerable situation regarding the conflicts

inherent in behavior-related termination. Employment conflict management has become the

modern trend used in resolving employment conflicts. Alternative Dispute Resolution (ADR) has

various methods a company can use to internalize a conflict and avoid litigation. FastServe has

to downsize, but at the same time wants to eliminate potential litigation. A three-way resolution

meeting, negotiated by a senior manager of human resources, puts the interest of the company

first, but at the same time attempts to use fairness, honesty and integrity to establish open

communication to reach a breakthrough where an amicable agreement develops.

Prior to a three-way resolution meeting, general counsel should be consulted to establish

if there is any legal probability. A plan has to be implemented that gives a time frame and what

type of process will be used to resolve the workforce conflict before the resolution meeting.

Mitigating the risk from possible employment lawsuits should included providing a layoff plan

for “… having a layoff policy may mean the difference between a company’s being perceived as

responsible and ethical versus socially irresponsible … [and a] planned strategic communication
 Employment Conflict 10

separates competitive companies from status-quo orientated organizations” (Smith & Walker,

2000, p. 134).

Documentation mitigates risks to aid in providing cause for the termination if an

employment lawsuit occurs. The documentation shows evidence of the employees’ job

description and performance that contributes to the reason for termination, as FastServe needs to

use to downsize because of redundancy and non-critical skills. Using ADR techniques in

employment conflict management gives a business the advantage of self-protection against

possible lawsuits through internalizing the employment problem to reach an amicable agreement

that is beneficial to all parties.

 Employment Conflict 11

References

Anderson, S. (2003, Apr.). How to keep layoffs from turning into litigation. Corporate legal

Times. (13)137, p31. Retrieved October 22, 2009 from EBSCOhost database.

Dana, D. (2001). Conflict Resolution, New York: McGraw-Hill Companies.

DASH-HRE Iowa Government (2009, Jan.). Preparation for a layoff: Reduction in force.

Retrieved October 18, 2009 from

http://www.dash.hre.iowa.gov/html_documents/ms_manual/16-05.htm

Mose, D. and Kleiner, B.H. (1999). The emergence of alternative dispute resolution in business

today. Equal Opportunities International 18(5/6), 54-61. Retrieved October 23, 2009

from Emerald database.

Ray, J.P. (2008). The influence of culture on conflict handling styles and use of mediation.

Retrieved October 23, 2009 from the University of Phoenix, ProQuest Dissertation

database. ProQuest document ID: 1731799391.

Reed, O.L., Shedd, P.J., Morehead, J.W., and Corley, R.N. (2005). The Legal and Regulatory

Environment of Business, (13e). New York: McGraw-Hill Companies.

Smith, P.C. and Walker, J.W. (2000).  Layoff policies as competitive edge. Competitiveness

Review: An international Business Journal Incorporating Journal of Global

Competitiveness. (10)2, p. 132-145. Retrieved October 23, 2009 from

University of Phoenix, Emerald database.

University of Phoenix eResource (2009). Employment at will and wrongful discharge

Retrieved October 5, 2009 from the University of Phoenix, eResource database.

University of Phoenix Simulation (2009). Legal issues in reduction of workforce. Retrieved

October 5, 2009 from the University of Phoenix, eResource database.

 Employment Conflict 12

Wertheim, E. (2002). Negotiations and resolving conflicts: An overview. Retrieved October

22, 2009 from http://web.cba.neu/-ewertheim/interper/negot3.htm.

Wilmot, W.W. and Hocker J. L. (2007). Interpersonal Conflict, (7e). New York: McGraw-Hill

Companies.