The Importance of Facts

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A big part of a mediator’s job is to elicit and isolate relevant facts. Then we can determine points of agreement and disagreement.

Mediations come in two basic types:
– Parties agree on the facts but disagree on how to interpret them
– Parties disagree on the facts

Facts

Model 1: We Agree on the Facts, But. . .
In this common situation, parties may disagree on issues such as:
– the degree of disability the facts describe
– the effect of facts pointing to a possible non-industrial cause of disability (apportionment)
– whether the injured worker could have returned to work under these facts
For example, in a recent mediation, the injured worker’s attorney obtained a last-minute vocational report to show the injured worker was 100% disabled. But that wasn’t the issue. The employer agreed the injured worker was completely disabled, but contended that the disability was largely caused by non-industrial factors. Mediation was the place to correctly define the issue.

After isolating the pivotal issues, we can define the maximum and minimum values for each side’s interpretation. Compromise mostly then comes down to narrowing the gap between the dollar demand and offer.

Model 2: Those Aren’t My Facts!
When parties are operating on different sets of facts, it’s almost impossible to settle. This situation can arise when parties are not communicating, often due to animosity built up over years. Examples include:
– Injured Worker has been treating the claimed injury with treaters unknown to the adjuster
– Injured Worker has treated for conditions which may or may not be related to the claimed injury
– Injured Worker has made another claim, consideration of which is relevant to resolution of this claim, such as a third-party liability claim for this injury or body part.

Facts exist, no matter how unfair it may seem to have to learn about them at a late date. In fact, for example, some treater recommended and provided treatment. In fact, a bill remains unpaid for such treatment. The employer can claim that the treatment was not reasonable and necessary or was not for the industrial injury, but the fact is still stubbornly out there.

Sometimes, revelation of these facts prompts adjournment of the mediation to allow time for collection and sharing of relevant documents. The mediation resumes at a later date. Once mediation participants recognize that a fact exists, they can readjust their viewpoint to see the case as Model 1.

Held Hostage by a Torturous Claim? How to Escape

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Do you feel like you and your clients are hostage to a claim that goes on and on? Every treatment request triggers a new round of litigation. The injury happened decades ago, and the disability percentage still has not finalized. The parties are at each other’s throats.

You can use tips from professional hostage negotiators to free the prisoners of that claim.

Keep Everyone Calm 
By definition, kidnappers are making unreasonable demands. The negotiator’s job is to keep everyone calm to work through the process without anyone taking sudden destructive action. 

Your opponent is a jerk, and your client has a knee-jerk negative reaction to every proposed alternative. Claim litigation can be stressful. The lawyer needs to walk a line between assuring the client of zealous advocacy and being a voice of reason. Near-hysteria can be contagious. So is calm.

In mediation among contentious parties, the mediator can separate them into separate areas, called caucuses, to block confrontation. The mediator channels messages between parties in a calm, reasoned way.

Active Listening
Hostage negotiators are trained to pay attention to the kidnapper, show respect for the kidnapper’s statements, acknowledge receipt of the message, and even read between the lines to figure out the best way to proceed to resolution. You need a mediator who knows how to do these things and can help you do them, too.

Keep Talking
Whether people are trying to defuse a hostage situation or settle an injury claim, as long as everyone is still talking, things will keep moving toward resolution. Prepare yourself and other participants coming with you to be patient. Bring snacks and something to do while the mediator is caucusing with other groups. Do not bring children. Confirm no one is carrying a weapon.

Continue to explore every path toward resolution. More often than you might imagine, an issue emerges that parties were previously unaware of.

At last. . . 
The most fraught situations can end in peace when participants control emotions and continue to communicate their needs.

Are You A Courageous Negotiator?

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Merriam Webster defines courage as the mental or moral strength to venture, persevere, and withstand danger, fear, or difficulty. The easy way to litigate is to react to catalysts from outside sources, such as the court, opposing counsel, or a medical emergency.

The courageous negotiator is proactive. That includes knowing how to push a claim to settlement. Courageous negotiators have strong values, fully use their skills, and purposely confront challenges.

Keep At It
Especially when claims drag on for years, it’s easy to lose sight of the end goal. Here’s how to keep moving forward:

1. Keep evaluating. Courageous negotiators know what their case is worth. Don’t be afraid to talk about a big number—or a small one– if that’s really the value of the claim. The old saying is that lawsuits are not like wine—they don’t get better with age. Re-evaluate as new information comes in.

2. Make offers. Don’t ask, “Do you want to settle?” Make settlement offers– even ridiculous ones. Solicit counter-offers. Let parties know that you are willing to duke it out, but you are also smart enough to know how to settle. Competent professionals don’t fight simply because they don’t know how to do anything else. Courageous people act even when they face the possibility of an adverse outcome.

3. Get help. Mediation is an effective way to settle cases. Talk to your mediator. A pre-mediation consultation is confidential even if the mediation never occurs. Information shared with the mediator can never be used, and the mediator cannot be subpoenaed. Unlike the parties who must deal with every detail of managing the case, the mediator concentrates on defining and resolving issues to reach settlement. Take advantage of that expertise.

Often the best way to promote communication is at mediation. Parties can be candid about the good and bad points of their case. Bargaining through the mediator can calm anger.
 
An agreement to mediate is not a commitment to settle. It is a commitment to talk about the possibility of settlement. If you’re not getting counter-offers, the mediator can focus parties on what needs to be done to move ahead.
 
There is no charge to talk with me about convening a mediation.

You know that ugly case is probably going to settle. Muster your courage to make it happen sooner.

Winning the Zero Sum Game

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Value-Added Negotiating

Many negotiators approach resolution as a zero sum game. Each side’s gain or loss is exactly equal to the other party’s gain or loss. Viewing the resources available as limited can obstruct getting to settlement.
 
Particularly when one or more parties have hit their dollar authority limit, adding non-monetary benefits to the discussion creates a larger number of benefits to divide. Some people call this “enlarging the pie.”

When there are more issues to discuss, parties can “log roll,” i.e., swap benefits across a number of issues, not just fixate on more or fewer dollars.

Different kinds of cases call for different solutions. Unique facts can inspire creativity. Here are some tried-and-true ways to add value.

Resignation
In workers compensation and wrongful termination cases, a resignation can add value. It clarifies the parties’ status and provides finality. Double-check to make sure you do not run afoul of statutory restrictions before raising this issue.

Respect 
In the right case, an apology can move negotiation forward.

Some claimants feel no one is listening. Perceived disrespect leads to resentment which prevents reasonable negotiation. All participants should make sure to show respect for the opponent’s position. One way to do this is by scheduling a mediation where everyone gets a chance to have their say.

Payments
In appropriate cases, you may be able to negotiate to characterize money as non-taxable. If some or all of the settlement can be considered payment for a physical injury or restitution for a loss such as property damage, the net benefit to the payee is greater.

Settlements usually call for a single lump-sum payment. But a different arrangement may be better for all parties. A classic way to do this is through a structured settlement. A structured settlement can provide more money for a claimant without increasing the cost to the payor. Other benefits might include Medicare Set-Aside compliance and professional investment management.

Sometimes, a defendant requests a payment plan. Even the largest defendant may need to spread a settlement over two budget years. When parties agree to a payment plan, a properly worded settlement agreement must spell out each party’s rights, obligations, and remedies.

Confidentiality 
Protection against damage to reputation can be a valuable bargaining chip whether the party is an individual, a corporation, or a government entity. Confidentiality clauses have appeared routinely in personal injury settlement agreements for decades. Defendants and their insurers don’t want to set a benchmark for future plaintiffs. Note: some jurisdictions have prohibited non-disclosure clauses in sexual harassment settlements.

Victory!
Victorious negotiators are those who walk away with a settlement. To get there, discard the zero sum approach. Find ways to add value instead

FOBO Paralysis

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Most of us have seen, and maybe used, the acronym FOMO. It means Fear of Missing Out. FOMO is the fear of making the wrong decision about how to spend your time, particularly after you’ve seen internet stories about others doing better. 

Negotiation FOBO
The related condition in negotiation is FOBO, Fear Of Better Options. Fear that there may be a better option prevents negotiators from choosing any option. Seeing reports of great results in other cases, unlikely to be identical, contributes to the situation.

Some people are “maximizers”; they think they must have the perfect resolution. So they need to consider every single option. The trouble is, too many options leads to indecision. Maximizers include the attorneys who want to pursue every avenue of inquiry regardless of the expense in relation to the likely effect on evaluation of the claim.

Happier, more successful people are “satisficers”; they know how to recognize an acceptable deal and move on. Satificers aren’t pushovers. They do their homework.  In mediation, they’re the people who have evaluated the claim based on historic data, expert reports, and their own experience. They present cogent, coherent arguments in their mediation brief. They have considered the downside of walking away from a deal though they might consider it barely acceptable.

To avoid FOBO, negotiators need to prioritize their needs and wants. For most mediation participants, the highest priority is closing the claim with an acceptable outcome. Continuing to litigate means months or years of additional expense and stress. Well-prepared negotiators know the status of the case today and realize that things could get worse in the future.

A Mediation Story

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The claim was decades old; indemnity was supposedly fully paid. The carrier hadn’t paid a medical bill in years. The applicant had dismissed her attorney, but continued to pursue the claim.

The carrier wanted the claim off the books, so they called me. Without prompting, the adjuster disclosed his authority limit to me in an email.

The applicant, the carrier’s hearing rep, and I met for mediation.

While there was no question the applicant was disabled, the dispute was whether the disability was industrial. Thankfully, the applicant had a very good alternate form of medical insurance which had been providing and continued to provide full coverage.

I spent time with the parties separately, allowing each of them to vent about how they had been taken advantage of by the other. Issues were raised, demands and offers exchanged. While remaining neutral, I empathized with both parties, discussing pros and cons. Finally, the hearing rep made what he said was an offer of his full authority.  I showed him my print-out of the email which showed authority for an additional $15,000. 

He stared at me.  “I have to make a call.” 

“Let’s make it together,” I said.

We got on the phone to the adjuster who said the hearing rep was correct. “Mike” (not the real name), I said, “Are you able to take a look at your email to me of [the email date]?”

“Yes, I see it.”

“That says your authority is $15,000 more.”

“Oh, I didn’t have that authority. I never had that authority.” 

I did NOT say, “Then why did you tell me that’s what you had?”

Instead, I went to the room where the applicant was waiting and put the hearing rep’s offer on the table.

“I have to call my spouse.” I left the room to give her some privacy.

After a little while, the applicant told me her spouse said the offer was an absolute non-starter.

The hearing rep stated he had to leave for another commitment, and the mediation adjourned without resolution.

A few days later, the applicant called me to ask if the offer was still open.  I said I would check.

The case settled by Compromise & Release for the amount of the hearing rep’s offer.

The Lesson

Parties sometimes need time to process everything that happened at mediation. They may have learned about new issues or gained new insights about the basis for the opponent’s position. People often have a negative kneejerk reaction to a demand or offer. After some time to cool down, they may be able to understand a different point of view, even if they don’t agree with it.

Think about why this case settled. What did the applicant gain by being able to talk about the claim with the mediator? What do you think happened between her and her spouse once she got home? What can you conclude about pre-mediation communication between the adjuster and the hearing rep, between the adjuster and the applicant?

How important is it to have everyone who will participate in making the settlement decision attend the mediation?

How Much Does Mediation Cost?

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You could pay $30,000 for a day with a retired state Supreme Court Justice. Or you could pay about a tenth of that amount for an effective mediator. When you’re ready to choose a mediator, check out the person’s bio (resume, CV) and request a copy of the fee schedule. A few mediators post their fees online, but usually you need to request a current fee schedule.

Who Pays?
In civil cases, the fee is typically split among the parties, though sometimes one side agrees to be the sole payer. In a typical workers compensation mediation involving only the Applicant and one Employer, the Employer pays the cost. If there are multiple parties or issues, such as a serious and willful claim or a third party claim for the same injury, the parties decide how the cost will be divided.

Holding Your Place
Some mediators, including WCMediator.com, charge an administrative fee which protects your choice of date. This fee covers all pre-mediation communications to set up the meeting. Payment confirms the parties are going forward. Some mediators charge as much as $1,000 for a cancellation within seven days of the reserved date.

Special Arrangements
Carve-outs are alternative workers’ compensation programs between employers and unions. Required mediation can be a feature of these programs. There is no cost to the injured worker to participate.

When a judge orders parties to mediate, they often benefit from a reduced-fee arrangement. Sometimes a court will provide free mediation to parties in the courthouse. Outside the courthouse, mediators on the court’s approved panel agree to abide by a fee schedule. This may get you a limited number of hours at no cost or at a reduced cost. Often when such a mediation is clearly progressing towards resolution and time runs out, parties choose to continue mediating at the full-fee rate.

Flat vs. Hourly
Some mediators charge by the hour, and some charge a flat fee for a half or full day mediation. Some mediators specify that in addition to the flat fee, hourly fees will be assessed if the mediation continues past the time allowance. One mediator quotes a “flat half-day fee” on his website which buys “1 hour preparation, 4 hours of session.”Don’t think you can book a half-day for a flat fee and simply go long. The mediator and other parties may have other time commitments.  If you use a full day of the mediator’s time, you will be charged for a full day.Clarify how charges for travel time and expense may be calculated. In addition to his hourly mediation fee, one Georgia mediator charges a flat $15,000 for travel within a five state area plus meal expense .

Features of a flat fee include predictability for the parties and payment up front to the mediator. Using an hourly fee structure assures you won’t pay for more time than you use. Workers compensation mediations are usually complex and take about five hours.

Bottom Line

At the end of the day, the bottom line may be about the same. Under either arrangement, most mediators do a lot of work without compensation, such as communicating with the parties in advance of the mediation. Additionally, if the case does not settle at mediation, mediators typically continue working with the parties by phone to reach resolution without additional charge. Unless you have submitted a human-size set of documents for review (not recommended), mediator preparation time is also free. If you are unsure, ask what the fee does and does not include and what services do not incur a charge.

If you don’t like the billing method on the mediator’s fee schedule, you can request an alternate quote that fits your comfort zone.

The real question is how much that claim will cost if you don’t settle. Mediation is highly effective and efficient in helping parties close claims, an excellent bargain compared to uncertain and expensive future litigation

Humility Leads to Mediation Success

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Here’s an oxymoron for you: the humble litigator. Like jumbo shrimp and military intelligence, it may seem ridiculous to pair humility with any litigator. But for anyone trying to settle a claim, a little humility can help get you to the finish line.

Most of the time that dispute will eventually settle without court intervention. The parties want to resolve the issue with the smallest expenditure of time and money. Incivility, bias, prejudice and anger are inconsistent with humility and get in the way of settlement.

Acting with humility does not admit fault. The most successful litigators are courteous and respectful.

I’m The One Who’s Right
Of course you are.

Then why is the other side fighting so hard to say the opposite? Of course they’re completely wrong, but maybe, just maybe, you could pretend they have a reasonable point of view. Or—here’s a shocking concept—try to see their point of view.

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Students learning to debate (or get through law school) may be asked to argue a position with which they disagree. While preparing for mediation, try to outline the other side’s position and think about all the reasons supporting that position. This is an excellent way to marshal your own arguments.  It is also an exercise in empathy.

You Want Me To Do What??
Think about forgiveness. When you feel wronged, your desire for vindication may make negotiation difficult. Forgiveness must be internal and not necessarily verbalized.

Forgiveness is about moving on, doing the best thing for you and those you represent, not for the benefit of the offender. Forgiveness keeps you in control of your emotions rather than surrendering control to the volatility of others. Forgiveness does not validate the other side’s behavior or minimize the damage it has caused. It doesn’t mean you were not wronged or that the parties will have a good future relationship.

Conversely, a well-phrased apology has helped settle many a case. For example, I watched one litigator, without any prompting and without admitting fault, express sorrow that the injured worker had experienced a lengthy delay in getting treatment. That may not be right for your case; for his, it was. Don’t forget that everything said in mediation is confidential and cannot be used for evidence in any forum.

Good People, Strong Emotions

You’re a good person, right? Yet, difficult situations can spark rage and other extreme emotions in the best of people who then behave without humility.

In mediation you can state your position in the strongest terms in a private session with the mediator. The mediator can then skillfully communicate those emotions to move parties to settlement.

A bit of humility can improve your effectiveness in formulating and reacting to those communications.

Documenting the Mediated Agreement

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Almost all of my workers compensation mediations end with agreement to a Compromise and Release. Parties often bring a partially completed Compromise & Release form, DWC-CA form 10214(c), to the mediation. That’s great. But when considerations prevent execution of a final agreement at the mediation, a Memorandum of Understanding, known as an M.O.U., can be invaluable.

What Is It
After working hard to come to terms, you don’t want to let the passage of time blur people’s memories or minimize their commitment. Participants should not leave the mediation without a record of their agreements.

A Memorandum of Understanding memorializes the skeleton terms agreed upon at the mediation. Parties sign off at the mediation. The M.O.U. might specify a timeline or conditions.

If It’s Complicated
Some settlements are complicated, requiring many addenda. Unanticipated issues may have arisen and been resolved at the mediation. Parties need to return to their offices to draft the final settlement document. The M.O.U. should specify the basic terms as well as deadlines for completion of the initial settlement document, exchange of revisions, and submission to the WCAB.
Conditional Agreements
Some agreements are conditional, usually upon CMS approval of a Medicare Set-Aside allocation. Attorneys may address this issue by doing everything but the walk-through, including signatures, pending approval. This leaves a potentially dangerous loophole when unforeseen events occur during the waiting period.Another way to document a conditional agreement is through an M.O.U. Unlike the agreement which sits in a file drawer, an M.O.U. can specifically address the condition, including what will happen if the condition cannot be fulfilled. For example, if CMS comes back with a higher amount, and the parties do not assent to that amount within a specified time, they can agree to return to mediation.

Getting to MOU

Mediation allows parties to address issues outside the jurisdiction and procedures of the WCAB and to fashion creative solutions.

If you have despaired of closing that troublesome,  decades-old claim, turn to mediation.

Take the bull by the horns, and the result may well be an M.O.U.

What’s Wrong With Telephone Negotiation?

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A litigation analysis found that lawyers used telephone negotiation in 72% of the cases studied resulting in settlement only 35% of the time. That means that phone negotiation sessions or other settlement processes had to be used multiple times to get to settlement. We can assume that repetition resulted in a loss of time and money for the participants.

In contrast, mediation resulted in resolution 100% of the time in the studied cases. Yet, lawyers used mediation in only 2% of the cases.

Lack of Visual Information
You can’t share documents or other visuals over the phone. Even if all participants to the call are supposed to have the documents in their possession, you can’t be positive they are actually looking at it, even if they say they are, or if it’s the right one.

Body language provides visual cues to the negotiator about how things are going. Facial expressions can show surprise, anger, or anxiety as parties exchange information. You can’t look someone in the eye over the phone. Without the visuals, it may be easier for people to dissemble. Likewise, over the phone you are unable to enhance your own message with gestures or other body language. In mediation, the mediator interprets participants’ body language to better facilitate negotiation.

Getting Negotiators to Pay Attention
Listening is hard work. When negotiators use the phone, they may not be focused. There could be active interference, e.g., flashing lights and text messages on the phone, incoming emails, other notifications from multiple devices, or co-workers coming by. Even without those distractions, people’s attention may drift.

Technology Can Get In the Way
What about using Facetime, WhatsApp, Skype or another video call utility? Theoretically, this could overcome some of the deficits of voice-only negotiation. On the other hand, have you seen the hilarious Tripp & Tyler video about video conference calls? Even when the technology is working perfectly, body language can be difficult to interpret or convey through video.

Video conferencing might be helpful during mediation if, for example, the adjuster or injured worker is in another state and unable to travel to the mediation, assuming the principal negotiators are physically present.

What About Meeting At The Board?
Meeting at the board could resolve some of these issues if the parties come with adequate authority, fully prepared, with all relevant information available to them, and with no time pressures.

How often does that happen?