FAQ

'Alternative Dispute Resolution' uses 'mediation' and 'arbitration' to resolve legal disputes without the burden and expense of litigation in court. Rio's 'Alternative Dispute Resolution Program' for employment disputes prevents employees from suing employers. This saves the employer time and money. Rio's ADR Program is a legally enforceable contract that applies to applicants, employees, former employees and the employer. Disputes are resolved economically, efficiently and confidentially.

The ADR Programs offered by Rio Services are simple and cost efficient. Rio's Alternative Dispute Resolution Programs provide for four (4) levels ('steps') of dispute resolution. The first two (2) steps are 'informal' procedures between the employer and employee. In 'Step 1 - Open Door' and 'Step 2 - Written Complaint', the parties discuss the dispute and try to agree on a resolution. If the parties do not resolve the dispute, a party can then request 'formal' proceedings, including 'Step 3 - Mediation' and 'Step 4 - Arbitration'. The parties must conduct mediation before a party can request arbitration. This saves the employer time and money.

The Appendix of this booklet contains information from the American Arbitration Association ('AAA') regarding alternative dispute resolution, including the legal basis for workplace ADR Programs. Also included is a form which employers can complete and send to Rio Services to order an ADR Program.

Rio's ADR Program includes the 'Employer Assistance Program', which provides the employer with free legal counsel. The savings in legal fees usually is more than the cost of the ADR Program (See No. 3 - What is the 'Employer Assistance Program'?, below.).

A Rio Alternative Dispute Resolution Program saves the employer time and money. The objectives of Rio's ADR Program include giving management an effective means of control in personnel administration matters, prevention of lawsuits, and reducing risk of financial loss. According to a recent study, the average cost to defend a wrongful termination lawsuit is approximately $150,000.00. Rio's ADR Program is effective in achieving these goals.

ADR provides a prompt, efficient, confidential, and affordable process by which to resolve employment disputes, such as 'wrongful termination' claims. When compared to the cost of defending cases in court — court costs, attorney's fees, lost work time, the cost of a Rio Services ADR Program is minimal. Rio's ADR Program minimizes the risk associated with making those 'hard' personnel decisions.

Rio's ADR Program includes the 'Employer Assistance Program' ('EAP') that provides free legal counsel to employers. The 'Employer Assistance Program' provides employers with up to two (2) hours annually of free legal counsel in matters of labor and employment law. This benefit is worth at least $700.00. If the employer retains Rio to conduct a Compliance Review at the time it adopts the ADR Program, then the EAP provides up to eight (8) hours annually of free legal counsel, worth at least $1400.00. This savings in legal fees, for most employers, actually pays for the cost of the ADR Program! In the event the employer needs additional counsel within the benefit year, then legal counsel is available at a substantial discount from an employment lawyer approved by Rio Services.

When adopted, Rio's ADR Program becomes one of the terms and conditions of employment, but it does not change the 'at will' status of employees. This means either the employee or the company can still terminate the employment relationship at any time, with or without prior notice. The ADR Program does not give any person any additional rights than the person already has under state and federal law. Similarly, the ADR Program does not impose any additional obligations on the persons subject to it, other than to use the ADR Program.

The ADR Program is a binding contract; most 'policies and procedures' are only 'guidelines' . Therefore, the ADR Program controls over other personnel policies and procedures. When the employer adopts the ADR Program, it becomes a term and condition of employment. The ADR Program should be considered an employment benefit. The ADR Program applies not only to applicants, employees, and former employees, but also can be adapted to include independent contractors.

Adoption of the ADR Program requires modification of existing personnel guidelines and procedures, such as discipline and internal complaint procedures. Rio Services offers assistance with such matters. Rio offers a comprehensive 'Compliance Review', which includes an audit of personnel practices and policies, and advice for correcting deficiencies.

Caution: Attempting to establish an ADR Program which does not comply with the law, can cause more problems than it solves. In order to be effective, the ADR Program must comply with applicable law. A flawed ADR Program can itself result in costly litigation. Rio Services offers the benefit of third-party administration of the ADR Program in order to avoid such problems.

Rio Services recommends the employer revise and update the current handbook at the time the ADR Program is adopted. Employment law changes almost daily. Employee handbooks should be reviewed at least every three (3) years. Rio Services prepares and updates employee handbooks. If the employer does not have an employee handbook, Rio can prepare one.

Rio's ADR Program is broad in scope and provides maximum coverage. The ADR Program is a legally enforceable contract, and applies to the employer, applicants for employment, current employees, and former employees. Rio's ADR Program requires all employment-related legal disputes to be submitted to the ADR Program for resolution, which includes mediation, final and binding arbitration, or both. Under current law, in order to be subject to the ADR Program, employees, do not have to sign an agreement accepting the ADR program. Under current law, the employer is simply required to give 'notice' to applicants and employees of the adoption of the ADR Program. After receiving such notice, if an applicant submits an application, or if employees continue employment, then they are bound by the ADR Program.

Rio's ADR Program is broad in scope. The ADR Program is a legally enforceable contract. It applies to all legal disputes regarding terms and conditions of employment which may arise between and among the employer and applicants, employees, former employees, managers and owners and, between and among all employees (See No. 7 - To whom does the ADR Program apply, above.).

Such employment-related legal disputes include failure to hire, wrongful termination, unlawful harassment (including 'sexual harassment'), and other matters concerning terms and conditions of employment, are subject to the ADR Program. Such legal claims must be submitted to the ADR Program for resolution rather than litigation in court.

Complaints filed with government agencies are not subject to the ADR Program. Parties subject to the ADR Program can file complaints with government agencies, such as employment discrimination charges, wage and hour complaints etc. The ADR Program does not restrict the employee's right to file administrative complaints with any government agency. Employees can file such complaints, and the investigation by the government agency is not in any way restricted by the ADR Program. Government agencies (for example, the Texas Workforce Commission, Equal Employment Opportunity Commission, Department of Labor etc.) are not subject to the ADR Program.

Governmental agencies can investigate, initiate complaints, and prosecute cases on behalf of individuals whose personal claims are subject to the ADR Program. The government agency's right to investigate and enforce the law is not subject to the ADR Program. However, the individual's personal right to file suit, if any, is subject to the ADR Program. Claims for on-the-job injuries subject to the Workers' Compensation Act, and claims for unemployment benefits are subject to the ADR Program.

Rio's ADR Program is a contract. As a contract, it applies to applicants, employees, former employees, and the employer — the parties must comply with the contract. Failure to follow the ADR Program can be a breach of contract. Rio's ADR Program provides that a party who breaches the contract, for example, refuses to follow or abuses the ADR Program, can be ordered to pay the costs and reasonable attorney's fees incurred by the nondefaulting party.

If an individual who is subject to the ADR Program files suit instead of using the ADR Program, the case in court is subject to dismissal, stay, or both. If an employee files a lawsuit, the employer's response is usually to file a request with the court, asking the court to order the case stayed, referred to ADR Program, or both. If the ADR Program is legally valid, and if the dispute is subject to the ADR Program, then the law requires the case be referred to ADR proceedings as provided in the ADR Program.

During the 'informal' discussion process between the employer and the employee (See No. 1 - What is 'Alternative Dispute Resolution 'ADR'?, above, regarding 'Step 1- Open Door' and 'Step 2- Written Complaint'.), neither party is represented in such discussions by a lawyer. Both mediation and arbitration may be conducted with or without lawyers. However, employees are free to consult a lawyer, and may also retain a lawyer, to represent them in formal ADR proceedings (mediation and arbitration). Rio's ADR Program contains a Legal Services Benefit provision, which provides that the employer pays a limited amount of money to the employee's lawyer if the employee desires legal counsel during mediation or arbitration.

Disputes may still be resolved informally between the employer and the employee, without using the formal ADR procedures. Often the fact that there is an ADR Program encourages informal settlement of disputes which might otherwise result in litigation.

Rio Services administers the ADR Program. Rio assists the parties in arranging the appropriate ADR proceeding. Rio's ADR Programs provide for four (4) levels ('steps') of dispute resolution. The first two (2) steps are 'informal' procedures between the employer and employee. In 'Step 1 - Open Door' and 'Step 2 - Written Complaint', the parties try to agree on a resolution. If the parties cannot agree, a party can then request 'formal' proceedings, including 'Step 3 - Mediation' and 'Step 4 - Arbitration'. The parties must conduct mediation before a party can request arbitration. This saves the employer time and money.

If mediation (Step 3) is requested, the parties may select the mediator. If the parties are unable to agree upon a mediator, Rio selects the mediator. The goal is to conclude mediation within 30 days after demand is made. Mediation is usually conducted at the mediator's office. At the mediation the mediation explains the guidelines for conducting mediation. After this introduction, the claimant presents a summary of the facts and law relevant to his or its case. The other party then responds with a similar summary. The mediator then separates the parties into separate rooms. The mediator meets repeatedly with each party, discussing the strengths and weaknesses of each party's position. The mediator helps the parties move beyond emotion, and to focus on the reality of the dispute, including the economic benefits of all parties of an agreed settlement rather than continuing to the uncertainties of arbitration. Most cases, about 85 - 95%, are settled in mediation. However, if the case is not settled, then a party can request arbitration.

All arbitration (Step 4) proceedings are conducted by the American Arbitration Association ('AAA'). Arbitration is rare. The goal is to conclude arbitration with 120 days after demand is made.

The employer and the employee may select their own mediator. Upon request for ADR, Rio offers assistance to the parties in selecting a mediator. If the parties are unable to agree upon a mediator, then Rio Services selects the mediator.

In Texas there is no legal requirement that a mediator be a lawyer; most are, and all mediators must be certified by the State Bar of Texas. Regarding arbitration, the AAA provides the parties with lists of qualified neutrals ('arbitrators'), who have knowledge and experience in the subject matter of the dispute. There is no legal requirement that neutrals be attorneys. In some cases, if the parties agree, professionals from other areas of expertise may be selected.

ADR proceedings almost always cost less than litigation. According to a recent study, the average cost for an employer to defend a wrongful termination lawsuit is approximately $150,000.00. Mediation and arbitration almost always cost much less. Mediators usually charge by the 'half day'. A typical fee for mediation would be $400.00 per half-day per party ($800.00 for one employer and one employee), and $750.00 - $1000.00 per party for a full day ($1500.00 - $2000.00 for one employer and one employee). Arbitrators usually charge by the hour. A typical range is $100.00 - $200.00 per hour. The American Arbitration Association charges reasonable administrative fees to conduct arbitration.

In almost every case, the cost of ADR is only a small fraction of the cost of litigation. In practice, most cases are resolved in mediation (85-90%), and arbitration is not required, which saves even more money. Rio's ADR Program saves the employer money in every possible way.

The Rio ADR Program is easy to adopt. The employer simply makes the decision to adopt the ADR Program, and contacts Rio Services (Order forms are included in the Appendix to this book.). Rio Services prepares the documents and sends them to the employer. Payment for the initial charges is due at the time Rio prepares the ADR Program documents for the employer. The employer may cancel the service upon written notice within 30 days of the renewal date (before or after). The employer must give 'notice' to those subject to the ADR Program (for example, employees and applicants). Rio Services provides the notice forms (bilingual, English/Spanish). A summary of the ADR Program is also available in both English and Spanish.

Caution: Attempting to establish an ADR Program which does not comply with the law, can cause more problems than it solves. In order to be effective, the ADR Program must comply with applicable state and federal law. A flawed ADR Program can itself result in costly litigation. Rio Services offers the benefit of third-party administration of the ADR Program in order to avoid the appearance of impropriety or conflict of interest.

Rio can implement the ADR Program the 'same day' if necessary. Adopting the ADR Program is easy (See No. 15 - How does an employer adopt Rio's ADR Program?, above.). Rio recommends having one of its representatives introduce the ADR Program at an employee meeting at the time it is adopted. Rio Services provides all documents, and continuing support service.

Rio's ADR Programs are affordable. The cost for the 'employment' and 'commercial' ADR Programs is calculated differently. The cost of the ADR Program for employment disputes is determined by the number of employees. The cost of the ADR Program for commercial disputes varies according to the company's gross annual income. Payment in advance for the initial one (1) year period is required. Thereafter, there is an annual licensing fee. The current 2011 initial cost information is shown below.

Rio also writes and revises employee handbooks and personnel policies. Rio recommends a 'Compliance Review', a comprehensive review of the employer's personnel administration policies and practices, at the time the employer adopts the ADR Program. Employee handbooks and personnel policies should be revised to reflect the adoption of the ADR Program. The employer may purchase only the ADR Program, or may also purchase a 'Compliance Review' and employee handbook review. An employer that purchases two (2) or more services from Rio receives a 10 % discount on the total purchase (See No. 3 - What is the 'Employer Assistance Program'?, above.). Other benefits include discounts to seminars and other services.

The current (2011) fees are shown below, and are subject to change.

Employer Workforce ADR Program or Employee Handbook

1)1 - 2 employees $0625.00
2)3 -14 employees $0750.00
3)15 - 49 employees $1000.00
4)50 - 99 employees $1250.00
5)100-299 employees $1500.00
6)300-499 employees $1750.00
7)500-999 employees $2000.00
8)1000 & + employees Contact Rio.

The above fees are for the initial one (1) year service period. The fees for annual licensing are explained below.

The fees for annual licensing are explained below.

ANNUAL LICENSING FEE- The annual licensing fee for the ADR Program for employment disputes is determined by the number of employees. The licensing fees are the Rio Foundation's primary source of revenue. The current fees, subject to change, are shown below.

Employer Workforce ADR Program

1)1 - 2employees $0500.00
2)3 -14employees $0625.00
3)15 - 49employees $0750.00
4)50 - 99employees $1000.00
5)100-299employees $1250.00
6)300-499employees $1500.00
7)500-999employees $1750.00
8)1000 & + employees Contact Rio.

Rio updates the ADR Program as needed; this service is included in the annual licensing fee.

Rio holds the copyright to its ADR Programs, employee handbooks, and other personnel administration documents. Upon payment of the initial fee, Rio licenses the employer to use the materials. The Rio Foundation depends of such licensing fees to fund its charitable activities. The Federal Bureau of Investigation investigates criminal violations of federal copyright law. The Rio Foundation protects its copyrights.

If desired by the employer, for an additional charge (travel expenses may apply for travel in excess of 200 miles), Rio will provide an attorney or other qualified professional to conduct a staff meeting to introduce the ADR Program, the revised employee handbook, or both. Rio recommends this 'professional' presentation in order to answer employees' questions.

Avoid the 'lawsuit lottery'. Rio's ADR Program provides both the employers and employees an efficient, confidential and cost-effective process for the resolution of employment-related legal disputes. The Rio Services Alternative Dispute Resolution Program is the best way to minimize risk of lawsuits, and lawsuit abuse. The ADR Program is a valuable risk management tool. Rio's ADR Program is easy to adopt, affordable, administered by professionals, and saves the employer both time and money.

American Arbitration Association. Rio's Alternative Dispute Resolution Program is approved for administration by the American Arbitration Association ('AAA'), the most respected dispute resolution service in the world. The AAA conducts arbitrations for Rio's ADR Program.

Employer Support Services - Comprehensive and Continuing. Rio Services provides employers comprehensive support services. In addition to its ADR Program, Rio's services include a 'compliance review' of personnel practices, employee handbooks, personnel documents, posters, notices, personnel policies and guidelines, job descriptions, employee benefit plans, seminars and assistance with administrative complaints and government investigations. Rio's ADR Program and its other services, reflect the many years of experience and professionalism of the people who work with Rio.

Employee Assistance Line. Both Rio's ADR Program and employee handbook service include the Rio Services 'Employee Assistance Line' service, a 24/7 bilingual (English/Spanish) 'help line' for employees who want information or may have complaints. This service conforms to guidelines established by the United States Supreme Court regarding unlawful harassment policies and procedures.

Employer Assistance Program. Rio's ADR Program includes the 'Employer Assistance Program'. The 'EAP' provides employers with free legal counsel in matters of labor and employment law. This benefit can provide up to $1500.00 annually in free legal counsel. This savings in legal fees, for most employers, actually pays for the cost of the ADR Program!

Affordable. Rio provides prompt, quality service, at an affordable cost. For most employers the free legal services in the Employer Assistance Program, may actually pay for the cost of the ADR Program! Rio provides comprehensive employer support services.

Rio Foundation. Rio Services is sponsored by the Rio Foundation, a nonprofit tax-exempt public charity. The revenue from its services goes to support many humanitarian activities.

http://www.rioservices.com

Order forms are included in this book. An employer can order an ADR Program by completing a form and mailing or faxing it to Rio Services (Rio Services, 5208 A Padre Blvd. #90; South Padre Island, TX 78597; toll-free fax: 800.891.4566). Order forms are in the Appendix of this booklet. The form can be photocopied and left in the booklet, or it can be removed from the booklet and used.

Order by telephone or fax: Rio's toll-free telephone number is 800.891.4554 (956.761.2289), and the toll-free fax number is 800.891.4566 (956.761.7424).

Order by e-mail: info@rioadr.com, or from Rio's website, www.rioadr.com.

The initial fee, and the fee for the first year renewal, must be paid at the time the order is placed. The current fee schedule is discussed on pages nine (9) and 10 of this book.

TOLL-FREE: telephone 800.891.4554, 956.761.2289 fax 800.891.4566, 956.761.7424 Website- rioadr.com e-mail: info@rioadr.com

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Contact Information

San Antonio

Telephone : 800-891-4554

Fax : 800-891-4566

5150 Broadway
San Antonio, TX
78209

South Padre Island

Telephone : 956.761.2289