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Last spring, attorneys in the legal department at The McGraw-Hill Companies in New York got the word from chief executive officer Joseph L. Dionne: It was time to supplement the open-door policy with a formal, inhouse alternative dispute resolution program (ADR). He told the attorneys to develop something that settled disputes quickly, something good for morale.
A team of 10 to 12 attorneys and human resource staff members spent six months-working with consultants, and meeting with employees, managers and executives from other companies with ADR programs-to develop the Fast and Impartial Resolution (FAIR) ADR program. In October, McGraw-Hill unveiled the FAIR program to its 15,339 employees in publishing, financial services information, and magazine and broadcast divisions in 35 locations from Boston to New York and Colorado to California.
The three-step program is voluntary, and starts with bringing in a supervisor or human resource representative to resolve a dispute. If that does not work, it moves to mediation with a neutral third party. If mediation is fruitless, the third step is binding arbitration with a written decision. The company pays the mediation and arbitration costs. In the first month, two employees agreed to use the program. But McGraw-Hill executives know that convincing most employees to use the FAIR program will mean living up to its acronym.
"The program cannot be skewed to where McGraw-Hill wins each of the disputes in mediation or arbitration," said Alvin C. Washington, senior vice president for corporate human resources. It's got to be a level playing field, for employees to feel encouraged."
VOLUNTARY PROGRAM EASES LEGAL ISSUES
By making the program voluntary, McGrawHill avoided the unresolved legal questions of whether a mandatory arbitration agreement "is necessarily enforceable based on the theory that continuing employment is adequate consideration," said George W. Leopold Jr., Mcgraw-Hill's associate general counsel. Leopold met with ADR executives from Chemical Bank, Cigna, J.C. Penney and the Brown & Root construction company when designing the program.
The FAIR program is typical of the programs many corporations are developing, human resource specialists and attorneys said. An increasing number of companies that had used informal fact-finding or open door policies are moving to formal structured policies. Peer review, ombudsmen or employee hot lines can resolve disputes over productivity, absentee policy and...