Internal conflict resolution systems save huge amounts of money for their organizations, provide support for those who have issues with something that has happened internally, and reflect the unique culture of each organization rather than having a single standard, like a specific law, applied to all situations no matter how different they may be.
One of the most satisfying and successful organizational systems is in the World Bank and was reported on at the ACR conference.
This system has five levels. The first three are accessed at any time by anyone who wants to talk about a problem. No referrals are needed, and the process is confidential. The highest two levels are formal resolution processes which apply mostly to legal cases, and are accessed by referrals from a conflict resolution specialist after a discussion at one of the three lower levels.
This system is the same for all offices worldwide, with a representative of the ombuds office in every location. While many organizations have formal processes in place, accessing them can be difficult, and because they often start with formal processes, they may not be appropriate for an interpersonal problem at work. These disputes are often left to managers who may not be trained or to HR executives who also might not be trained or who may have some experience but whose loyalties may be suspect to the person walking into the office hoping for support.
I asked how the process was developed and whether it was planned in its current configuration at the very beginning of its development. The process was developed organically over time and came in response to concerns and complaints from employees. However, it was also agreed at the beginning that the process had to be available to everyone and at their initiative.
The three speakers reported excellent results and good feedback on people’s experiences with the program. I’m not sure this system applies to disputes with people outside the organization, like vendors or clients, but I don’t see why it couldn’t. Other systems include anyone or any entity with a dispute, and many new, large-scale construction processes sort out their dispute resolution system before construction begins. Those systems include every vendor, contractor, sub-contractor, legal entity and anyone else involved in the project. In one project I reviewed, the conflict resolution process in all its detail was signed by everyone and hung in the main construction office, so everyone knew whom to call if a dispute arose. By agreeing to the process right from the start, the success of the process is greatly enhanced.
And then there is Wells Fargo.
The news is filled with stories related to the fraudulent credit card accounts created by Wells Fargo employees under pressure to fill unreasonable sales quotas. These accounts cost Wells’ clients millions in fees for accounts they did not sign up for and didn’t know they had, and Wells is being held responsible. Their CEO resigned, several thousand employees were fired, and the new CEO pledges that things will change and be made right. On the other had, employees who called this massive fraud to their managers’ attention early on were also fired before the actions became public. So much for protecting whistle blowers.
What about the clients whose accounts were charged these fees? What happens to them?
At least in Los Angeles, panels have been established to handle many of these cases through mediation, and progress is being made. This approach is fair, applied to all clients equally and with the same fixed costs, and seems to be working. One of my favorite mediators is on that panel and has expressed real satisfaction with how it all works.
Unfortunately, Wells is back in court to prevent the cases from going to mediation and insisting on enforcing the arbitration clause in the agreement, which the clients never signed or even saw since the accounts were opened fraudulently.
Full disclosure: I’m against arbitration clauses. I don’t see any reason why you have to sign away your right to the American justice system just to get a job or see a doctor, or yes, get a credit card. In an article in the New York Times, the reporter commented that industry arbitration panels are often stacked against the consumer, are secretive, are not fair, and cannot be appealed.
In addition, arbitration agreements contain language saying that the client agrees not to join any class action suit against the company (or legal entity) which is often the only way to get through the very expensive legal process and get some form of justice. Large companies can drag out cases until the other party has run out of money and just gives up. Not sure how that is justice.
One court has upheld the right of the client to sue and to join a class action because the arbitration clauses were intended to apply to legally opened accounts and the arbitration agreement should not apply to illegal acts which amount to fraud and identity theft. Since the agreements were opened fraudulently and never saw the agreement, the client whose identity was stolen cannot be held to the arbitration clause. If Wells wins they will avoid the class action and save millions, and the clients who were defrauded will get industry arbitration.
Where is the World Bank system when you need one?
Have an absolutely wonderful and peaceful week.