The Role of the Ombudsman

By Donna N. Saleh

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APRIL 2005 - For many companies, the cost of doing business has skyrocketed because of employee-initiated lawsuits. According to the most recent figures provided by the Equal Employment Opportunity Commission, the average cost to settle a discrimination lawsuit in America is approximately $297,000, excluding legal costs.

Employers are taking an active role in reducing the risk of litigation by employing the services of an “ombudsman”: a neutral, confidential, and independent third party to handle employee complaints before they become lawsuits.

Harassment and discrimination claims represent one of the most costly forms of employee litigation for companies. In April 2003, a group of eight female workers at Brooklyn’s Lutheran Medical Center were awarded more than $5.4 million in settlement of claims that a doctor had sexually harassed them. In 2000, Coca-Cola Enterprises agreed to settle a racial discrimination suit for $156 million. In 1998, Home Depot settled a gender-based discrimination suit for $65 million when hourly employees alleged that the retailer discriminated against women by offering them fewer promotions. These suits followed the major Texaco settlement of a racial-based discrimination lawsuit in 1996 for $140 million. As a result of these types of lawsuits, many major corporations have agreed—as part of their settlement—to implement an ombudsman program.

Trustworthy and Dependanble

More often than not, employees are reluctant to voice allegations relating to issues such as harassment or discrimination, out of fear of the possible repercussions. To combat this fear, the ombudsman is viewed as a trustworthy, dependable, and risk-free party to whom employees can voice concerns confidentially. The ombudsman’s role is multifaceted, and includes the following functions:

  • Listener. Oftentimes it is helpful for an employee to merely use the ombudsman as a listener to help clarify the issues, disentangle complicated situations, and prioritize concerns.
  • Information resource. The ombudsman is available as an information resource, providing access to applicable guidelines and policies, or facilitating communication with other services or appropriate administrative units.
  • Provider of options. The ombudsman may suggest a range of feasible options and help employees evaluate the pros and cons.
  • Role-player. The ombudsman is available to discuss potential situations and role-play an upcoming meeting, as well as suggest constructive approaches to handle difficult situations.
  • Informal intervener. With permission of the complainant, the ombudsman can act as an intermediary to clarify issues and initiate problem-solving, including facilitating a mediation session.
  • Trend recorder. The ombudsman will periodically report to management on problem areas and trends within the organization so that such issues can be addressed through policies and procedures.

In today’s litigious environment, taking steps to reduce the risk of litigation is a smart business decision. Through the eyes of an employee, there may be nothing to lose and everything to gain by initiating a discrimination or harassment lawsuit with the potential for a payoff and satisfaction. Through the eyes of an employer, all it takes is one major lawsuit to adversely affect the bottom line and, therefore, whether or not the corporation makes a profit at the end of the year. The role of the ombudsman is essential in effectively managing employee relations and reducing the risks associated with litigation.

Donna N. Saleh, JD, LLM.




















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