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Professor David Lipsky is a leading academic and researcher in
the area of Collective bargaining and Dispute Resolution. He has
been on the faculty of Cornell University since 1969 and has held
various positions including Dean of the School of Industrial
and Labor Relations and has served on the Board of Directors of The Industrial
Relations Research Association.
Bolded lines represent questions posed by HR.com.
Can you tell us about the PERC Institute on conflict resolution and
what the institute is about and what its goals are? And how and
when it was formed?
The Institute is part of the school of Industrial Relations. So maybe a word
about the ILR School is a good start. The ILR School was formed in 1945,
by an act of the New York state legislature signed by the governor of that
time which was Tom Dewey. And so it is a state supported unit on the
Cornell campus…and there is no question the ILR arsenal came into being
because of the focus in the 1940’s on labor relations. Over time, the
school focused less on labor relations and more on human resources
management, and labor issues more generally. What we have done is we
had not focused directly on dispute resolution per say or not on dispute
resolution outside of the group bargaining context, but in a labor relations
context. We have not focused much at all on ADR or “Alternative dispute
resolution”. So the institute was formed officially on August 1/96 to fulfill the
objective and purpose of taking the school more generally in that direction
of focusing in ADR, more than we had done so in the past. The principle
benefactor of the Institute is a very well known mediator and
arbitrator…someone very well known in labor relations named Ted Keel.
Ted was Cornel bred, he graduated from here at the undergraduate level
and he is also obtained a law degree from here in the 1930’s. He was quite
well established as a lawyer but made his reputation as a mediator and
arbitrator and he has always been a loyal Cornellian. He made a major gift
to the school in 1996 with the purpose of establishing the Institute in 1996.
Ted had a foundation called “The foundation for the Prevention and Early
Resolution of Conflict or PERC…so consequently the name of the Institute
reflects a kind of partnership between the PERC Foundation and Cornell.
So the Institute was named The Cornell PERC Institute of Conflict
Subsequently we have received additional funding i.e. 3 years Sealor grant
The Institute has a three-part mission that really mirrors the mission of the
School of Industrial Relations and indeed the University. We sponsor
research, we do research, we have resident teaching instruction at the
graduate and undergraduate level. So we engage in a number of
We have focused on a number of projects including the use of ADR in
major companies. That is probably pretty well known right now. In the area
of research we have done other things as well for instance The Use of
ADR in Worker’s Compensation by Ron Seeber.
Secondly on the teaching front we are trying to develop a more
comprehensive curriculum in the area of conflict and dispute resolution -all
the way up to the graduate level.
Lastly and most importantly, we are playing a significant role in the
Outreach area and the major manifestation in this area is The Alliance for
Education in conflict and dispute resolution.
The Alliance is a network of universities and professional associations who
have an interest in conflict and dispute resolution. Presently we have
something like 14 affiliates; the universities include MIT, the University of
Illinois, Georgia State, Ohio State, UCLA, to name a few…and Cornell
which of course is the lead. The professional organizations include the
Labor and Employment Law section of the American Bar association, the
National Bar Association, The Industrial Relations Research Association,
and SPIDR (a.k.a. the Society of Professionals in Dispute Resolution).
The alliance then is a consortium of organizations. One of the main
functions of this consortium is to provide training and education programs
in ADR. And the first priority is to train mediators who can handle
employment disputes and while that will not be our only priority…it is where
we got started, as we were and are responding to the needs expressed by
our member organization.
So there has been this rather dynamic growth in the use of arbitration and
mediation to resolve employment disputes…and there is some question
whether there is an adequate supply of neutrals to handle the caseload.
Is there any movement toward certification?
That has been a big topic of conversation among the members of the
Alliance. You know there never really has been certification in the
mediation or arbitration realm. There are a few states that try to regulate
this…but by and large this has been an open marketplace, anyone
gaining acceptability can pursue a practice in the mediation or arbitration
Basically you hang up your shingle, and if you attract a client you’re an
arbitrator/mediator so to speak. But apart from a couple of states that are
fussier, by and large the market drives it. If you can make a living at
it…you are a professional mediator/arbitrator. But there is a growing
feeling that there ought to be some sort of certification process. There is a
lot of interest within the Alliance towards moving toward that goal. It will be
a very difficult goal to achieve because it hasn’t existed in the past. We will
see; it may be something we strive for as we move along.
In my honest opinion, with all the involvement of lawyers…I am
surprised they haven’t moved toward licensing this field before.
Well that’s right…there is a lot of interest in moving in that direction by the
legal community. Some consider mediation/arbitration to be a practice of
Yes…it is in their best interests to bar this avenue through
licensing I think. Lawyers are very apt at taking over areas that
have high margins and so forth.
You are absolutely right and this has created a great deal of controversy.
Their is a great deal of debate…you have some lawyers who are Pro-Ban
on taking over labor mediation and arbitration and then you have some
other people who are not who are resisting this movement.
By and large the question of certification is one that is still very much in the
forefront, yet still very unresolved.
What do you feel is the role of Human Resources in the
management of employment related conflict?
I think it is actually critical. I know from my own experience there are quite
a few Hr managers who feel they are really involved in that or in some
cases need to be involved in employment conflict. I recently attended a
seminar, where a very prominent HR person spoke of 10 or 12 things that
are going to be more of a priority in the HR realm in the 20th century and
he did not list conflict resolution or conflict management. I called this to his
attention, and it just didn’t register on his radar screen, he felt this would
still be best handled by council/attorneys and thus not a priority for him.
On the other hand, we have been doing a great deal of research and
visiting a number of companies. In the process we found that in a number
of corporations ADR, conflict resolution or whatever you want to call it, is
still not a priority, however in the vanguard companies it definitely is! With
the vanguard, at least the ones we have been talking with, the HR
department has been solidly in the middle of conflict management and
resolution. They do indeed, whether you go to GE, Ford or TRW, or
numerous others…the HR professionals will say this is a top priority for us
and we need to design a system that will enable us to meet this need.
What are the key principles and tools should an HR person be
aware of, if they are interested in the prevention and resolution of
conflict in the workplace?
That’s a huge question and one that we have been working quite hard on.
And in addition, I am a member of a SPIDR task force in which we are in
the process of creating a report that focuses on the providing the answers
to the question you just posed and that we hope will be quite helpful.
Any early observations then David…for HR people if they are looking
to keep this in mind?
Yeah…let me mention a couple…
Firstly, there is a kind of mind-set that companies need to have in order to
make headway in this area. Let me illustrate in the following way…most
disputes that happen at the workplace, once they move beyond a certain
level – the level that has traditionally been the responsibility of the HR
person – they move to the council’s office. For example a discrimination or
worker’s comp complaint…they say,” that’s the lawyer’s job…let the lawyer’s
handle it”. I would characterize that as the typical reactive way disputes are
handled in the workplace. It does indeed move out of the realm of HR and
move it into the council’s office, and they do it (solve the dispute).
The more advanced corporations have taken a very different approach – a
proactive approach – and have said no this is not just a council’s
responsibility, it is indeed HR’s responsibility. In fact it is a responsibility of
line management as well.
We have to move this down to the lowest level of the organization and
make it the responsibility of the immediate supervisor/line manager/hr
support and begin to train these people. They need to expand on their
traditional duties and learn to be managers of conflict as well.
That requires education, training and proactive policies on the part of the
organization. The other thing that is taking root is a systems idea, and I
will tell you what I don’t mean. I don’t mean a simple policy or procedure…it
is not simply the council’s office saying we are going to use mediation
whenever possible to handle conflict and disputes; it involves what I have
already said. What it does involve is providing a series of ways for
resolving conflict when they arise and an attempt to prevent them at
multiple levels in the organizations.
If conflict does arise, the SPIDR task force is going around the idea of
multiple access points and multiple options – thus a systems approach to
mediation. Meaning you will have a toolkit for handling conflict and you will
pick and chose the solution depending on the circumstances. You don’t
necessarily have a linear approach to solve things, no bottom to top
solution; rather a series of choices, strategies that penetrate at different
What’s the value of developing a corporate ADR solution as opposed
to ad-hoc or dispute-by-dispute approach?
Again that is an excellent question and a huge one. Forgive me for
this…we have been doing research on this…
The truth of the matter is; different corporations answer it in different
ways. We have interviewed companies that are absolutely opposed to
ADR, absolutely opposed to a systems approach, completely for the use of
lawyers and litigation and at the short end of the term they would rather
fight than switch.
If I was a Director of a company and a manager came to me and
suggested we develop an ADR system…I would be interested in
the possible effect on the bottom line…at first glance it looks very
expensive to set up …and in what areas will I reap the benefit by
seeing improved performance in the corporation?
There is no question…there is one thing we have discovered through our
research both in terms of our survey of over 600 companies and through
our more intensive fieldwork. We have discovered that across the board,
the primary motivators are cost and time (Both are terms used to discuss
cost). Saving time and saving money…it does take time to setup and run
an ADR plan/policy and there are some fears on what those costs might
be …but you have to keep in mind when you are talking about legal and
statute disputes…the number of employment statutes and regulations has
grown tremendously and thus the growing interest in ADR…as this
increase in regulation opens the doors to the number of employment
disputes which may now go to court to be solved and those cases can take
years to resolve and can cost lots and lots of money.
And so very typically you see in the corporate world, when they finish with
a case that takes them years and years to resolve and millions of dollars
to complete…they start to wonder if there isn’t a better way to do business.
They turn to the HR and council offices and say… “ You guys figure out
how we can handle these issues in a cheaper and more expedient
fashion.” Invariably, what evolves is something like an ADR policy or
system. It has cost them money to implement…but if you can resolve
disputes at the lowest level more expediently or avoid them altogether you
can bet you are going to save lots and lots of money.
There may be many reasons why you still don’t want to do this. For
example, we talked with a leading pharmaceutical company,
Schering-Plough out of New Jersey, and they had exactly this kind of thing
happen. They had a couple of major lawsuits and top management got
concerned about just what the legal costs were. It is a combination of the
cost of major lawsuits and the cost of the legal function in general, that
make up the costs to a corporation. They (Schering-Plough)
commissioned a study and someone from the legal office (Deputy
General) and HR office (VP of HR) undertook this study. After a year they
concluded the study and presented their results to top management. What
they concluded was that an ADR policy across the board would probably
save the company money.
There is not only the dollar savings that can be validated…but the
human factor as well…you can by validating people’s concerns
help reduce turnover, increase performance and a number of
Right…but what I wanted to point out was, this company decided not to
institute an ADR system/policy for the following reason. In the course of
doing their study, they discovered that middle managers were opposed to
an ADR policy because they felt it would undercut their authority. They
didn’t want facilitators/mediators etc. second-guessing the decisions they
had made after the fact. In fact this is very similar to the feeling many
middle managers have about unions. They don’t want anyone interfering
with the control and authority they have in the workplace.
You have identified in your research that companies that use
some type of mediation or arbitration are more likely to have
experimented with other forms of ADR. Do you think this
experimentation is maximizing behavior, where they are looking
for the tool that will provide them with a perceived competitive
I think the short answer to this is yes. I think we are in a period where a lot
of experimentation is taking place in this realm.
While some companies are saying I want to completely stay away from this
for their own reasons; be they philosophical, intellectual or emotional.
There are some managers who on the opposite side of things just believe
in it and don’t care about the money. They just feel it is the right thing to
Let me comment…what we have found in this era when retention and
recruitment is such a concern to not only HR, but middle
managers…companies are not only trying to sell employees, current and
prospective, on the attractiveness of wages and benefits but on the
fairness and justness of their workplace and on the feeling that they treat
their employees well. So in effect we have come across a number of
companies that this has become a boasting tool. While you can’t claim (not
enough research) that an ADR system has any effect on retention or
recruitment…there is the belief on the part of some managers that this is
part of a package that creates/maintains and encourages the belief of a
Human Resources Management and Industrial Relations
management have evolved into two different disciplines that often
act in isolation. What are the benefits of a more integrated
I really believe they are significant benefits to an integrated approach and
this may be revealing my age…showing that I have been around long
enough to remember when everything was integrated. I think integration is
about alignment. I think it is more difficult to get alignment on goals and
needs when you have a separation between functions. We find that
sometimes, one part of an organization is pursuing one resolution strategy
and another a completely different one and in many cases this causes
problems. When people finally get together in an organization, they can
find they don’t share the same goals and then you have an internal
problem that needs dealing with.
In Canada there is a mandatory requirement to include a grievance
procedure in collective bargaining agreements. It removes the
chance of a strike or lockout during the administration of a
collective agreement. Could you comment on this?
Parties came to this conclusion voluntarily in the U.S…not all but most. Not
all use mediation… the TEAMSTER contract is an interesting case in
In the non-union case there has been more and more evolution in this
area and are developing their own procedures for handling grievances
The folks in the field make a distinction between rights based and interest
based conflict resolution. There is clearly a feeling that there has been too
much focus on the rights based form of resolving disputes and that is
probably true in both the union and non-union sector. But there is more
focus on developing and working within interest-based resolution… and
what they are talking about…the basis is negotiation. There is the feeling
that what we need in the work place is the option to resort to interest
based resolution…including negotiations, facilitation, and arbitration…the
Let’s talk about this, let’s not impose resolution, let’s reach resolution.
There tends to more buy-in and ownership when this occurs and there is
research to support this standpoint. Maybe not as much as we would
like…but from a philosophical point of view it seems to make sense.
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Litigation, including arbitration, is not far removed from warfare as illustrated by Napoleon’s invasion of Russia 200 years ago. The general idea is to intimidate your adversary to accept terms...By Jacques Joubert