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Avoiding the mire of miscommunication

Published on Saturday, 10 Sep 2016

The Background

Hong Kong has, for many years, been a prominent hub for mediation in the Asia-Pacific region. The city is renowned for the high density of dispute resolution professionals and its popularity as a seat for arbitration.

The Hong Kong government introduced the Mediation Ordinance in 2013 to provide a regulatory framework for the conduct of mediation. The ordinance encourages people to “mediate first” before resorting to other means.

I was recently invited to mediate an employment dispute for an non-governmental organisation (NGO). The dispute centred around a disagreement over new pay terms in the renewal of a worker’s contract, which I will go into detail about below.

The Case

The employee in question was a contract staff member whose terms of contract were due for renewal. I was advised that her condition for renewal was a pay rise of 7 per cent.

The management of the NGO stated that the employee’s performance was acceptable, but did not warrant a 7 per cent pay rise. They also mentioned that the employee received a 2 per cent increase during the company’s most recent annual pay adjustment, which was earlier this year in April.

Should the employee insist upon a 7 per cent increase, the company said, it was prepared to terminate the contract.

Since  the months ahead were considered “peak season” for the NGO, management worried that an employee’s  departure would cause disruption to the operation of the organisation. They were also concerned that a new staff member may not be able to settle down and become accustomed to the work in good time.

The management was prepared to retain the employee at a maximum additional pay rise of 2.5 per cent – contributing to a total increase of 4.5 per cent, which would be in line with the salary adjustment of civil servants.

When I met with the staff member, I was soon convinced that there had been a miscommunication between her and the general manager of the organisation, who was her direct boss.

She told me that her suggested pay rise was in response to the general manager’s question about what she wanted in the case of a renewal of contract. She had understood, however, that a pay adjustment had already been made in April, and it was not her intention to ask for a 7 per cent pay rise upon renewal of the contract.

She told me she was willing to continue working at the current salary and agreed to have it reassessed during the next annual adjustment, together with other staff members.

However, she also lodged a few complaints about the administration of the office. She told me that the approval of her annual holiday had not been conducted swiftly, and that compensation for leave due to overtime work was not processed in good time.

She said that she would very much like to have some assurance that these processes could be improved, so that she could plan her holiday with her family, as well as look into classes for her further studies. Unsurprisingly, she preferred not to raise these concerns with the general manager during a dialogue on contract renewal.

The Solution

After further mediation, the employee’s contract was renewed amicably. The employment terms were unchanged, while her concerns were sensitively communicated to management for internal review.

One of the important tasks the mediator must perform when dealing with an employment dispute is to record and document the settlement in writing, or to assist the parties to do so.

The parties will typically signify the settlement in this way to confirm the terms of their agreement. Any agreement so reached and recorded is regarded as a contract between parties.

As seen from this case, mediation provides a platform for different parties to communicate their issues in a private and confidential manner. With the mediator’s input, a mutually satisfying settlement proposal can often be achieved.

The effectiveness of mediation has led some employers to include a dispute resolution procedure, with provisions for mediation, in their employment handbook or employment policies. If your company has not yet taken this step, it could be of benefit to look into making this change.

This article appeared in the Classified Post print edition as Avoiding the mire of miscommunication.

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