Objective criteria
From MicroJustice
Contents |
[edit] The Problem
At a certain stage of negotiations, disputants have to divide benefits/damages. Negotiations about distributive issues could easily amount into a costly and time consuming contest of will power. Therefore, disputants can best use objective criteria to distribute benefits in a manner that is acceptable for both of them.
[edit] Negotiation environment for distributive issues
Negotiation theorists recommend disputants to look for objective criteria when it comes to negotiations about distributive issues. The use of objective criteria has a positive effect on disputants’ capacity to amicably come to a wise and fair agreement. Several arguments can be given to support this claim. As a part of their problem solving method of Principled Negotiation, Fisher, Ury and Patton claim that adhering to an external standard is likely to be wiser than an arbitrary result: it increases the chance of benefiting from past experience. It is easier to follow an independent standard than to give in to the other side’s positional demand. Basing a settlement on an external standard is likely to diminish the chance that a person will regret the settlement later. Building on this, an obvious way out for distributive issues is to look for criteria that other people have used to settle similar issues. Finally, looking for objective criteria is the only real alternative for solving the distributive issues by what comes down to a contest of willpower, a contest that endangers relationships and can be time and money consuming.
[edit] Standards for evaluating outcomes
Several standard that parties use to evaluate the possible outcome of negotiations are found:
- self-interested utility maximization: parties may evaluate the possible outcome of negotiations by the gain they perceive themselves to get. Basically, they assess the amount of value they receive as such.
- expectancy disconfirmation: parties may evaluate the possible outcome by comparing it with the outcome they expected to receive prior to negotiations. If it deviates to a large extent in an unfavorable manner, the possible outcome will be evaluated negatively.
- social utility: parties may evaluate the possible outcome with the outcome the other party will get.
When disputants use objective criteria, they shift the focus of negotiations from concrete outcomes to a joint searching for criteria that should determine the outcome. In such explicit negotiations, fairness/justice is found to be a prominent determinant of acceptability. The above mentioned standards for evaluation are less likely to be used by disputants when objective criteria as standards for evaluation are available.
- Objective criteria may be seen as absolute standards: the outcome objective criteria amount into may be seen as intrinsically fair.
- Objective criteria can be seen as a proxy for how other people deal with distributive issues (social comparison). People feel a deep need to be treated in the same way as comparable others are treated in similar situations.
Furthermore, using objective criteria as standards for evaluating outcomes in these ways has a strong positive effect on the satisfaction with the outcome afterwards. This increases the chance of compliance with the negotiated agreement. Also, in long term relationship like for instance between traders, it is more likely that the parties cooperate in the future.
[edit] Examples of Objective Criteria
Some examples of objective criteria are:
- Schedules for damages
- Formulas for sharing damages in case of contributory negligence: for instance a 20 % discount on damages for not wearing a helmet
- Formulas for severance payments in case of dismissal of an employee: 0.5 monthly wages for each year served with the company.
- Rules that determine that a doctor has to disclose treatment risks to his patient if they have a 1% (or 0.1, or 3) chance of occurring.
On Objective Criteria for Family Problems and Objective Criteria for Consumer Issues we give some examples.
[edit] Sources of Objective Criteria
Various different objective criteria from different sources can be used. For some issues, markets prices can be used as an objective criterion. Sometimes, case law gives clear guidance. If courts have to process many cases of the same type, they may be inclined to develop guidelines, or to accept guidelines developed by others. General fairness criteria may be used as objective criteria.
Sources for criteria can be found everywhere, depending on the subject of the case. A considerable save and important source for norms and criteria are the ones from the law. They can be found in court practice, lawyer practice and case law.
[edit] Legal Rules
Sometimes, the legal system supplies clear legal rules that can appropriately be used as objective criteria. Guidelines, damages schedules, clear landmark cases that are applied broadly may give some direction.
[edit] Law as Source for Objective Criteria
The advantage of using rules of law is that these rules are generally accepted and are often developed by courts. The norms are products of ,for example, jurisprudence. It means that judges and other experts have thought really thoroughly about the norms. But also the standard norms in the rules of law are important. The objective criteria in the law are easy to use in the negotiation for a settlement. Don’t forget that this is about Alternative Dispute Resolution. The rules do not have to be strictly lived up with. These rules of law and their criteria can be adjusted and liberalized to reach a settlement if parties both want to. But be careful that you don’t stretch the rules of law too much. The utmost boundary to stretch, is the point that for one of the parties a solution in court is the better one (BATNA) and you don’t want the party to pick that way. BATNA stands for the Best Alternative To a Negotiated Agreement. This means that as a party, you will look at what the outcome of the conflict will be when you go to court, so in other words when a judge decides. When this isn't better for you than the outcome of the negotiation you will stick to the negotiation. When the outcome of a verdict by a judge will be in your best interest instead you will know how far you can stretch the negotiations or you can choose to take the road to court. There can be a correlation between mediation and the system of law. The outcomes of the adjusted rules of law with the connecting objective criteria can give feedback to court practice. The developed criteria can be used in future comparable cases, just like rules of law in jurisprudence. The objective criteria will become a source of knowledge after a while. Mediation and other ADR will collect, classify and comment the objective criteria, just like the development in jurisprudence. In the future it will be easier to find reasonable criteria and it will moderate more time instead of searching again and again for objective criteria. This will also save costs and will be more efficient. An additional benefit for clients, is the possibility to verify if they endowed properly (JBM Vranken, Algemeen deel: een vervolg (google.books example)).
[edit] Going rates
One way is to identify going rates: what rule of thumb is applied in the most common cases by courts? In relatively simple cases, a limited number of factors determine the outcome. Judges may more or less intuitively come to a decision. However, the question is how to identify these rules of thumb. What are effective ways for having people to share this knowledge? What other methods for identifying these can be developed?
[edit] Fairness principles
Efforts for empirically studying what people find fair, have found a limited number of principles that are used. Principles like equity, equality and need are used by people to determine what a fair (or: just) allocation of resources is. Strong indications were found that these principles are commonly applied across cultures. However, the problem with such principles is, is that they are very abstract. Therefore, they are difficult and costly to apply in concrete cases. What are effective ways to translate these principles into more concrete, general distribution rules that are suitable as objective criteria?
[edit] Social comparison
A factor that to a large extent affects acceptance of outcomes is what other people in similar situations find acceptable. How can other people’s preferences be made transparent?
[edit] Local norms and practices
Social norms can be used as objective criteria. However, in some cases, they can be a part of the problem, namely when they systematically disadvantage certain groups. How can these social norms be identified?
[edit] Other
People may also have valuable ideas about what appropriate objective criteria are. How can we get them to share their ideas and thoughts? What are good incentives?
[edit] Suitable Objective Criteria
Some objective criteria may better support disputants than other. Take, for instance, legal rules. In one view, private law is full of objective criteria. Rules regarding contract formation, contract consequences, tortuous conduct and civil procedure are manifold. For many other relationships, similar detailed rules do exist: the rules of company law and administrative law, for instance. But in actual disputes, these rules may be of limited help to disputants having to divide the pie. A very common category of disputes relates to the termination of long term relationships (family, employment, land use, business contracts). Agreeing about the consequences of termination, such as the division of common assets, compensation for specific investments, timing and notice periods, and continued relationships with clients and others, may be very difficult because civil codes and contracts give little guidance as to the ways to cope with these distributive issues.
Certain properties of objective criteria make them more suitable as tools to resolve disputes. Especially properties that have a positive effect on the acceptance of possible outcome of negotiations by disputants and properties that reduce disputants' costs for dispute resolution make objective criteria more suitable.
[edit] Independent of Will Power
The more objective the better. Criteria that are linked to facts that can be established objectively will be preferable, not only in order to save costs, but also to diminish self-serving biases; they give more clear guidance to disputants.
[edit] Legitimacy
Objective criteria can provide legitimacy. Legitimacy can mean different things. It can refer to the source of the criteria: official acknowledgement by the legal system, for instance, or acceptance by a group to which the parties belong. Criteria may also be legitimate, however, because they reflect certain principles with inherent qualities to disputants.
[edit] Belonging to Parties
Disputants can look for objective criteria developed by others and borrow them, but also choose, or even develop, their own criteria, for instance in contracts.
[edit] Continuous
When the objective criteria are of continuous nature instead of providing binary ‘yes or no’ answers, they may be easier to use and considered to be more legitimate. Continuous criteria give percentages, amounts, figures, degrees, points on a scale, or ranges that lead to outcomes. Continuous criteria may make it more easy to reach outcomes agreeable to both parties (compared to criteria giving “yes or no” answers) because they directly lead to intermediate outcomes.
[edit] Applicable To Both Parties
Criteria are more easily applied and appear more neutral when they encompass the interests of both parties in a similar manner. Specific criteria should also be applicable when the other party would be in a similar position. Further, a criterion preferably is applicable to both parties in a particular dispute, weighing similar elements of the situation at both sides.
[edit] Non-exclusive
More than one criterion can be applied to the problem, rendering different outcomes. The pattern of these outcomes can give the parties an indication of what a reasonable solution is. The parties may split the difference between the outcomes suggested by two, equally acceptable criteria. They may give weights to criteria, or they can ask for neutral advice on what relative weights criteria should have.
[edit] Tailor Decisions to Circumstances
The solution the disputants strive for is a personalized one, not an abstract general solution, imposed by an outside intervention. Objective criteria that leave room for contextualization are less likely to be seen as imposed from above, or by the party who proposes them.
[edit] Practical
Objective criteria should be practical. They should be easy to apply, not requiring intensive fact-finding.
[edit] Transparent
As stated above, objective criteria may function as standards for evaluation. They should especially allow disputants to compare themselves with other in similar situations and the outcomes they received.
[edit] Delivering suitable objective criteria
Unfortunately, suitable objective criteria are not abundantly available. Rules primarily are seen as an issue for the legal system to supply. However, legal rules are primarily seen as commands, steering conduct and outcomes. Courts will apply and enforce legal rules, if a plaintiff complains that another person does not observe them. This does not result into suitable objective criteria, that is objective criteria that really support disputants. See Delivering objective criteria.
