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<xTITLE>The Trading Zone in Mediation of Employment Disputes</xTITLE>

The Trading Zone in Mediation of Employment Disputes

by Jan Frankel Schau
October 2014

Jan Frankel Schau's Mediation Blog

Jan Frankel Schau

Sometimes I feel like I’m in the middle of a tug-of-war. This week I had the anomolous situation of having two nearly identical full day cases back to back. In the first, the Plaintiff started the demand at $1 million and Defense offered $30,000 (the equivalent to one year of salary). She was alleging age discrimination, though the Company had laid her off in a reduction in force and she was only 42. In the second, Plaintiff started the demand at $200,000.00 (Plaintiff was also earning $30,000 per year, also sued under the Fair Employment and Housing Act for disability discrimination and was also laid off, but for “cause” which he believed was pretextual) and Defendant made an opening offer of $15,000. The second case settled for mid-$80,000.00 at about 7:00 PM, but the first case is “stuck” and impassed at 9:00 PM when the parties were at $80,000 and $100,000. Both sides had reached their “limit” and so had a very tired and exasperated mediator who had worked all day to get the parties into exactly that zone. So the question this week is how does a mediator work to tug the parties into the reasonable “trading zone” so that the case can be settled on the day of mediation?

In the second case, bracketing was an effective means of getting the parties familiar with the “Zone of Possible Agreement”. But in the first case, those zones simply did not overlap. The offers were in the multiple $100,000's and on the defense side stayed well-below $100,000 all day. Still, with such unrealistic expectations, I was reluctant to do a mediator’s proposal under $100,000.00 because Plaintiff’s counsel convinced me his client would reject it. Although I am confident that both cases will settle and that both were greatly assisted by the mediator’s efforts, the ultimate objective in every negotiation is to “close the deal”. Does anyone have thoughts on how to avoid this “tug of war” and get within the trading zone sooner so that at 9:00 PM when mediator and parties are exhausted and depleted, the parties don’t give up and abandon the effort to “close”?


Attorney Jan Frankel Schau is a highly skilled neutral, engaged in full-time dispute resolution. Following a successful career spanning two decades in litigation, she has mediated over 700 cases for satisfied clients. Ms. Schau understands the nuances of trial and settlement practice as well as client relations and balancing the needs of their representatives with the risk and expenses of trial. Those who have used Ms. Schau’s services recognize excellence in her persistence, optimism, creativity and integrity.

Ms. Schau was the President of the Southern California Mediation Association in 2007 and is recognized as among the most outstanding mediators in Southern California in the mediation of civil disputes by her peers and clients. She also serves as a Trustee of the Board of Directors of the San Fernando Valley Bar Association, and has presided as Chair of it’s Alternative Dispute Resolution Section and Litigation Section. She holds a Certificate of Advanced Skills in Negotiation from the Straus Institute for Dispute Resolution of Pepperdine University as well as from the Western Law Center for Disability Rights at Loyola Law School.

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