“Like it or not, you are a negotiator.”
Getting to Yes, by Roger Fisher, William Ury, and Bruce Patton.
No matter who you are, we all negotiate on a daily basis, whether that is to secure the best price on produce at the farmer’s market, or working out which dates you will visit family during the holidays.
Attorneys have both the pleasure and challenge of negotiating as representatives on behalf of their clients. Below are some helpful strategies for navigating settlement negotiations with opposing counsels.
Know Your Strengths and Weaknesses
Identifying your strengths and weaknesses will help prepare you for a negotiation. For example, has the PQME said there is a significant amount of apportionment to a prior injury? Or to use a different example, does the applicant lack substantial medical evidence to prove up their claim?
If so, these are examples of persuasive facts that can an applicant’s attorney decide whether settlement is in their client’s best interest.
There is a significant difference between presenting the two following offers:
- Defendant is willing to offer $25,000 for a Compromise and Release,
- Defendant is willing to offer $25,000 for a Compromise and Release. While the claim is accepted, the primary treating physician’s indication is that the burn has fully healed as to applicant’s left arm. A voucher is not owed because applicant has continued to work for the employer.
The first offer is conclusory and doesn’t really explain the basis for it. The second offer gives applicant’s attorney some facts to relay to their client, which can help make their job easier too.
As with anything, it is helpful to know your case’s worth and to be able to provide evidence that supports your position.
Whether to Make the First Offer
“Your opening offer acts as a powerful psychological anchor in a negotiation. It carries a lot of weight. Your opening represents the most you can (usually) hope to get.”
The Truth About Negotiation, by Leigh Thompson
Many people may shy away from making the first offer for fear of giving away too much information too early. However, author Leigh Thompson’s research has shown that negotiators are not harmed by making the first offer. Instead, Thompson notes that those who make the first offer tend to do well in negotiations.
The party who makes the first offer likely has a compelling analysis of the case strengths and weaknesses and is able to articulate to the other side the reasoning for their offer. Additionally, if a defendant is able to “anchor” parties to a lower settlement value by presenting the first offer, that could cause the applicant to refrain from making a demand that is excessively higher than that offer.
Additionally, making the first offer communicates to the other side that you are willing to come to the table to resolve issues. Presenting the opening settlement offer applies pressure on the other side to also come to the table if they want to get the job done.
Play the Game, Not the Player
Have you ever had to negotiate with a particularly difficult individual? As we all know, sometimes attorneys are less than amicable.
On one occasion, I even received on email from an opposing counsel that said, “you should eat and get some sleep.” He was, unfortunately, not being as considerate as it sounds.
With these individuals, you may find difficulty in offering any concessions when negotiating settlement. However, an effective strategy that combats this dilemma is to continuously focus on arguing the issues and merits of the case, rather than with the person themself.
Being kind and cordial with your opposing counsel allows parties to cooperatively work together to obtain a settlement. This is especially important as the pool of worker’s compensation attorneys is not that large, and it is likely that you will face opposing counsel multiple times over years of practice. If you damage the relationship when trying to settle one case, there is a chance that on another case, an opposing counsel will be reluctant to negotiate in good faith.
Know Your Audience
There is an advantage to knowing how opposing counsel handles their cases. Are they interested in settlement, or are they prone to litigating every issue to the fullest extent? Either way, having experience with their personality and style can encourage successful negotiations.
For example, I have worked with one applicant’s attorney who is fair, and usually provides a clear supporting breakdown of how he and applicant reached their settlement demand figure. Overall, his settlement demands appear meritorious, with only minimal range to negotiate it down.
On the other hand, other applicant’s attorneys will give a massive six-figure demands on five-figure cases without a supporting breakdown as to why that figure was reached. Applicant’s attorneys issue these excessively high demands with the knowledge that most defendants will never accept them. Instead, these inflated demands are merely an effort to “anchor” the defendant, and move the eventual settlement midpoint to a higher elevation.
Knowing the opposing counsel’s strategy and tactics can provide an indication of whether they are willing to keep negotiating and settle for less, or whether they have reached an amount that they are willing to settle for.
Never Say Never
How many times have you dealt with a party, or heard someone say, “I will never settle for anything less than $XX,XXX”?
Using very strong language (i.e. always/never) can be indicative of positional bargaining, which ineffectively ties parties to positions instead of negotiating on the merits of a case. (Source: Getting to Yes.) In other words, use of this language undermines negotiations by distracting from the actual case itself.
A statement like, “I always demand my client receive the supplemental job displacement voucher” is a position that may not always hold up.
What if the voucher is not owed? When facing an opposing counsel who uses always/never language to positionally bargain, break down the situation and attempt to reason with the individual that most situations have nuance, and are not ‘always/never’ situations.
You Have Tried All You Can to Settle, What Next?
Despite our best efforts, it’s common for parties to reach an impasse when discussing settlement.
If this happens, filing a DOR can help. A Declaration of Readiness presumes that parties have made good faith efforts to resolve the dispute prior to seeking board-involvement.
If you have truly done your best to communicate with the opposing side (i.e. emailed them, called them, written letters, or negotiated as close as you could without either party being able to reach an agreement), it may be time to request WCAB assistance to move the claim forward towards resolution.
Fortunately, settlement is usually (but not always) in the best interest of all parties. When negotiation is approached thoughtfully, it can be a litigators most effective tool in securing favorable outcomes for clients. And when settlement isn’t in the client’s best interests, we at the Law Offices of Bradford and Barthel are always happy to put up a good fight and try the case!
Good luck with your negotiations.
Alina Ahmed is an associate attorney at Bradford & Barthel’s Oakland location. Before joining B&B, Alina clerked for the L.A. District Attorney’s Office and later worked on third-party insurance defense claims. If you have questions about workers’ compensation defense issues, feel free to contact Alina at aahmed@bradfordbarthel.com or (510) 268-0061.
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