Business

Here's your final offer … and a hug

It had been a long day. My client and I were drained. After hours of intense negotiation, it seemed as though we had reached an impasse.

We made our final offer and packed up our briefcases to leave, but just then our mediator returned and said, “Guys, she says she'll do the deal. There's just one more thing. She wants a hug.”

My client and I looked at each other and shrugged. This sort of thing happens only in mediation.

In virtually every lawsuit, at some point the parties participate in a mediated settlement conference. The mediator, a neutral third party trained in alternative dispute resolution, hears from both sides and attempts to facilitate a settlement. It is an informal process with no sworn testimony, no jury and no judge. The mediator has no authority to declare a winner, but only to work toward a resolution acceptable to all.

When it works, mediation brings an end to litigation. The parties sign an agreement, often drafted by the mediator on the spot, and shortly thereafter dismiss their claims.

Successful mediation circumvents the need for trial, reducing legal expenses and lessening the burden on the court. The parties cannot, however, be forced into a settlement. If there is an impasse, the lawsuit proceeds to trial and a judge or jury declares the winner.

By the time our mediator proposed settlement terms including a hug, my client and I had already been down a long road. My client was an employer who had been sued for sex discrimination by a former worker.

As is often the case in employment discrimination cases, the financial and emotional stakes were high.

The company sympathized with the plaintiff, a longtime employee with financial difficulties, but was adamant that her gender had nothing to do with the termination decision.

We had been through months of discovery and depositions. We felt good about the evidence, but there is always risk at trial and always a possibility of appeal.

A good mediator knows how to focus parties on their interests, not their dispute. Rather than debate who is likely to prevail in court, a skilled mediator highlights the flexibility and finality of settlement.

A company may wish to make payments over time. An employee may want certain language included in a reference letter. The parties may agree to keep the settlement confidential.

Mediation allows the parties to explore resolutions outside the scope of what a court can provide.

Over the course of several hours, our mediator had brought us close on a number of points, but the plaintiff still wanted more money than we were willing to pay. My client's representative, a human resources director who had been friends with the plaintiff, was losing patience. We decided to make one final offer as a “take it or leave it” proposition. We never expected the counter offer of a hug.

I always tell my clients if you can give something to the other side and it does not cost you anything, you should do it.

In this instance, at the end of a long day and a long case, facing the prospect of a long road to come, the hug would not be a deal-breaker. We drew up the papers and my client gave the plaintiff a hug.

She wanted to give me a hug, too, and I agreed (even though it had not been negotiated into the bargain!). Within weeks, the case was dismissed and the parties went on with their lives.

A hug almost never settles a lawsuit, but a creative mediator finds ways for parties to come together beyond just dollars and cents.

Stephen J. Dunn is a partner in the Charlotte firm Van Hoy, Reutlinger, Adams & Dunn and specializes in representing employers.

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