Mediation and franchising go together like peas in a pod. Mediation has been in the Franchising Code of Conduct from the start. So what steps can you take that will make the process successful for you?
Before you can even begin to mediate you first must issue a notice of dispute.
This should clearly set out the basis for your dispute and how your dispute breaches a section of the franchise agreement or the code. The other side is then given three weeks to provide a response. If there is no agreement after the initial notice is issued and following a further three-week period then the matter can go to mediation.
Mediation is a process; it does not necessarily give you black and white outcomes. The process can be very costly especially if you have interstate franchisees as you will be forced to have the mediation in the state in which the franchisee is located.
How can you best achieve successful mediation?
1 Advice
You need to understand the issues at hand. It may be the franchisees in dispute are unable to properly articulate the full extent of the dispute or the particular issues that really affect the matter.
Get a lawyer or at least a related technical advisor to explain the situation to you fully.
2 BATNA (best alternative to negotiated agreement)
What is your best alternative if you can’t work out the problem at mediation? Can you afford to go to court? Will the continuation of the matter through the court process affect your ability to operate your business? What other considerations should you take into account should the matter continue and not be resolved at mediation?
3 Read and review all documents
The biggest problem is turning up to a mediation unprepared. Read all your material and documents, and that of the other parties. If you have difficulty understanding those documents, you may need to get a technical advisor (an accountant, engineer for instance) or someone with significant experience to analyse the documents and advise you.
Make sure that you understand what it is that you are talking about and what it is that you are disputing.
4 Know what you want
Ensure the people around you understand the issue at stake. Understand how to best articulate the outcome or particular process you seek; you will need to articulate any changes in a very simple way.
5 Make sure the right people attend the mediation
The person who attends mediation on behalf of the franchisor or franchisee, excluding the lawyer, must have the right to execute agreed terms.
Whoever is appointed to turn up to the mediation should have a clear written authority to settle the matter.
