It’s time to mediate a case with an ex-employee. Now what?

January 29, 2020 | By Andrew J. Horowitz

Today’s blog will review a scenario that is a common occurrence for many practicing employment lawyers, but that might not be as common for our readers. Let’s say that a former employee has filed a discrimination, harassment, and/or retaliation suit against your company in federal court. Your lawyer calls and says that the Judge has ordered you to participate in mediation.

Is this normal?  Does this mean the court thinks there is merit to the claims?

Yes, this is typical, and no, it not a judgment as to the merits of the claim. Many federal district courts have local rules directing the parties to engage in mandatory mediation early in the case. Even in the absence of this, however, it is common for federal district judges and state judges in some jurisdictions to order parties to attend mediation, either before a private mediator or before another judge. This reflects a prevailing view amongst judges that regardless of the merits of the parties’ respective claims and defenses, it is best for the parties to at least consider early settlement. 

Am I required to settle?

No. Nobody can make you agree to a settlement that you don’t want to agree to. You are merely required to have an appropriate person or persons appear for the company at the mediation and participate in good faith.

What does it mean to participate in good faith?

There is no hard and fast definition of this. Certain jurisdictions have definitions of good faith, and if you are in such a jurisdiction, your lawyer should so advise you. Otherwise, good faith in a mediation can be summarized as attending, listening, and making informed decisions about what, if anything, you should offer to settle.

What if we don’t want to make a settlement offer?

Again, nobody can force you to make a settlement offer, but if you have decided that you do not intend to make any settlement offer, it is good practice to inform counsel for the other side of this before the mediation, particularly where the other party may respond by deciding that it is not worth their time and expense to attend mediation (provided that the court will allow them to do so).

Who should attend a mediation?

Different courts have different rules on this. Many courts and mediators require that a person with “full settlement authority” attend on behalf of the company. A person has full settlement authority if they are empowered to settle the case in any range that it could predictably settle in without having to call someone else for authorization to settle. This is, for obvious reasons, highly subjective. Keep in mind, however, that the purpose of this rule is that a mediation can only be successful if the actual decision-makers are genuine participants. If an employment claim is covered by Employment Practices Liability (EPL) insurance, an insurance claims representative will need to be included in the process, preferably by attending in person or by being available by phone. 

What happens if the case does not settle at mediation?

To paraphrase a certain motto, “what happens in mediation stays in mediation.”  Expect to be asked to sign an agreement to mediate that sets forth the parties’ and the mediator’s confidentiality obligations. Under Federal Rule of Evidence 408, nothing that is said or done in mediation can be used in subsequent or other proceedings. This rule is intended to allow the parties to be candid with each other and with the mediator in attempting to reach settlement without prejudicing their litigation positions should the case not settle.

Unlike a judge, a mediator may speak with the parties privately, outside the presence of the other party. The mediator should not share anything said in these private sessions with the other side unless you or your attorney gives permission.

Will I be in a room with the plaintiff?

Probably only briefly.  A joint introductory session is typical, but most of an employment law mediation happens with the parties in separate conference rooms while the mediator works with one side or the other.

Will the plaintiff speak and if so, what should I do?

Some mediators like to allow the plaintiff to speak at the beginning of the session to explain why they feel they were a victim of discrimination or other unlawful treatment at work. This can be useful because in reaching a settlement, the plaintiff is required to give up his or her “day in court.” Some plaintiffs will therefore be more willing to settle if they feel that they “heard” during the mediation. If this occurs, it is best to listen politely and avoid having a visibly defensive reaction. Your counsel will advise you depending on the case and the personalities involved, but in many cases, a comprehensive opening statement from the defense outlining the weaknesses of the plaintiff’s case can be counterproductive.

Will the mediator tell the plaintiff that they don’t have a case?

A good mediator rarely makes such a proclamation, as this is not an effective means to drive the parties toward settlement. When I am acting in the role of the mediator, I ask pointed questions to help the parties evaluate the strengths and weaknesses of their respective claims and defenses in order to reach a settlement. At the end of the day, it is up to the parties—with the mediator’s assistance—to decide whether they are willing to resolve the case. 


The Author is approved as a mediator by the U.S. District Court for the Western District of Pennsylvania.

The information contained in this publication should not be construed as legal advice, is not a substitute for legal counsel, and should not be relied on as such. For legal advice or answers to specific questions, please contact one of our attorneys.

About the Authors

Andrew Horowitz

Andrew J. Horowitz

Associate

Andrew is a strategic and pragmatic attorney who focuses his practice on complex commercial litigation and employment law matters. Andrew serves as a trusted advisor to his clients. He enjoys taking a...

Read More by Author