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ENFORCEMENT NEGOTIATION SKILLS
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ENFORCEMENT NEGOTIATION SKILLS TRAINING
INDEX
TOPIC TAB
AGENDA 1
FACULTY BIOGRAPHY 2
NEGOTIATION PLANNING
AND PREPARATION OUTLINE 3
NEGOTIATION STRATEGY WORK SHEETS 4
PUMP N' DUMP CASE
GENERAL INSTRUCTIONS 5
CWA SIMULATION: U.S. v. ATC
INSTRUCTIONS FOR NEGOTIATION EXERCISE 6
NONVERBAL COMMUNICATIONS
GESTURE CLUSTERS 7
FUNDAMENTAL PRINCIPLES OF NEGOTIATION:
A GUIDE FOR EPA OFFICIALS 8
NEGOTIATOR PLANNING/MANAGEMENT MODEL 9
POINTERS FOR THE CONDUCT
OF A NEGOTIATION 10
ALTERNATIVE DISPUTE RESOLUTION (ADR)
PRESENTATION 11
CONTRACTOR LISTING FACT SHEET 12
EVALUATION FORM J 13
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1
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NEGOTIATION SKILLS TRAINING
ATLANTA, GEORGIA
NOVEMBER 17-18, 1993
Day One Wednesday. November 17
9:00 am Introduction
9:30 an Basic Negotiation Concepts and Principles - Lecture
A. Dynamics of the negotiation process
B. Phases of negotiation
C. Negotiation management essentials
D. Alternative Dispute Resolution Techniques
10:30 am Break
10:45 am Film: "Inside Look at Collective Bargaining".
Produced by the American Arbitration Assn.
11:30 am Negotiation Styles and Attitudes - Lecture
12:00 pa LUNCH
1:00 pm Planning and Preparation for Negotiation - Lecture
A. Purpose and importance of detailed, analytical
preparation
B. Preparation steps
C. Determining bargaining proposals
D. Establishing negotiating strategy
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-2-
2:00 pm Introduction to U.S. v. ATC - Negotiation Simulation
for Tomorrow
A. Overview of simulation
B. Assignment of negotiating teams
C. Distribution of team and individual simulation
materials
rNote: Individual teams, at their discretion, may hold
brief organizational meetings after adjournment.]
2:15 pm BREAK
2:30 pm Introduction to Negotiation Planning Simulation -
"Pump N'Dump"
2:45 pm Begin Negotiation Planning Session
3:15 pm Begin Negotiation
4:00 pm Negotiation Deadline - Plenary Evaluation
4:30 pa ADJOURNMENT
Dav TWO THURSDAY. NOVEMBER IB
9:00 am (^muni cations in Negotiation - Lecture
A. Barriers and breakdowns
B. Active listening
C. Nonverbal messages
9:45 am Ethical Considerations and Defensive Tacti.CS—
in Negotiations - Group Exercise
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-3-
10:30 am BREAK
10:45 am CWA Simulation - Planning Session for Negotiation of
United States v. ATC
12:00 pm LUNCH [As determined by negotiating team]
1:00 pm Negotiations Begin: Between representatives for the
United States and American Titanium Corp.
3:00 pm Negotiation Deadline
Faculty de-briefing of individual negotiating teams
3:30 pm BREAK
3:45 pm Plenary Discussion of United States v. ATC
4:15 pm Evaluation
4:30 pm ADJOURNMENT
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sVTRATTo^/
BASIC NEGOTIATING
CONCEPTS AND STRATEGIES
American Arbitration Association
Department of Education and Training
i T50 Rhodt Island Avenua. N. W.
\Vasfxlnglon. D.C. 20036
(202) 256-2333
SATISFY THE NEEDS OF ALL PARTIES. This i9 psrhap3 the single moat
important idea in successful negotiations.
BE PREPARED TO TRADE. Negotiations usually involve a series of
compromises. Follow the practice of most negotiators and begin
above your objectives.-
DON'T COMPROMISE YOUR OBJECTIVES. Don't settle in the heat of
negotiations for terms which you may later decide are unacceptable.
Be prepared to lose the deal if you are not completely satisfied
with the terms.
SELL. Successful negotiations are primarily the result of your
selling yourself and your:objective to others. You get a raise
because your boss is sold on you. . .you acquire a company because
they are sold on you. You get your way through selling.
DON'T OVERSELL. Overselling — to accomplish short-term objec-
tives — is one of the biggest temptations in negotiations.
Whether you're trying to get a job, sell a product, negotiate a
contract (wage or other), or convince a company to merge with you,
any temporary successes in negotiations may be offset by subse-
quent failures — losing long-term objectives.
NEGOTIATE ONLY WITH THOSE IN AUTHORITY. Avoid discussing terms
with intermediaries whose assignment is to secure as many con-
cessions from you as possible before their principals arrive on
the scene.
DON'T UNDERESTIMATE OTHERS. They are strong enough to be in the
position of dealing with you.
BE CALM. Maintaining your cool at all times confers an unques-
tionable advantage. Never lose your temper 1 (At least don'.t
show it.)
CONCEPTS
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- 2 -
KEEP A POKER FACE. Never act pleased as terms are agreed upon..
Be positive, but keep your tone matter-of-fact and "as expected."
TELL YOUR STORY YOURSELF. Most situations call for the presenta-
tion of information, both written and oral. You should be present
to be sure your message is getting across and to learn whatever
possible from observing people's reactions.
DEAL FROM STRENGTH. The successful negotiator deals most effec-
tively after s/he has identified hi3 or her strongest points and
uses them strategically.
KEEP THE MEETING ON THE TRACK. Be alert for the person who con-
tinually digresses. Keep your objective in mind and the meeting
on the subject.
DON'T REACT TOO UNFAVORABLY TO YOUR OWN MISTAKES. Life is one
huge negotiation, and if you are human, you will make mistakes.
Try to keep them to a minimum.
SLEEP ON IT. If you have any doubts about a proposal or parti-
cular terms, delay your decision until tomorrow. Do not yield
to pressures for an immediate decision, which is usually unnec-
essary anyway.
DON'T RUSH THE OTHER SIDE. This may be one of the most important
decisions of a person's career, and s/he needs time.
WHEN THE MISSION IS ACCOMPLISHED - LEAVEI This maneuver reduces
the chance that someone will change his or her mind or that you
will continue to talk needlessly until finally you say the wrong
thing.
STRATEGIES
FORMULATE A TOTAL PLAN. Without one, most negotiations fail.
With a plan and objectives clearly in mind, you can consider the
effect of each change as you compromise.
KNOW THE NEEDS OF THE OTHER SIDE. As quickly as possible, dis-
cover their true needs — which are usually not what they verbally
indicate to you, or what they compile on a long list. Revise
your plans and strategy accordingly.
SIT AT THE HEAD OF THE TABLE IN MEETINGS. Be sure you (or your
chief negotiator) secure the number one seat — "end of the table,
back to the window, and facing the door."
TAKE COMMAND OF EACH MEETING. Handle introductions, direct seat-
ing, suggest lunch plans, and be the first to get down to business.
GO MORE THAN HALFWAY. If you are the person initiating the meeting,
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- 3 -
direct all efforts to the convenience of the other side and set
the appropriate atmosphere for a successful negotiation.
CAREFULLY CONSIDER THE EFFECT OF MEETINGS IN PUBLIC. 3e sure
that general awareness of your meeting cannot in any way jeopardize
its success.
THE FETOR THE PARTICIPANTS, THE EARLIER THE AGREEMENT. In all
meetings, keep the number involved to a minimum. . .you'll go
home much sooner.
MAKE AN EARLY CONCESSION. Early in negotiations try to satisfy
the other side on an area very important to them. They will usually
reciprocate on areas important to you.
DON'T WAIT TO TELL BAD NEWS. Most people hate surprises. If some-
thing unfavorable develops during negotiations, bring it up on a
timely basis. If it has to be told, delaying only weakens, your
position.
DEFER DISCUSSIONS OF KEY ISSUES. Allow enough time to elapse to
enable everyone to learn all the facts and to fully evaluate the
situation and the people involved. You may need to change your
strategy or even your objectives, and it's best to know it before
you've committed yourself.
MAKE PROMISES WITH CAUTION. It's easy, in the course of a series
of meetings, to say you'll do something, and it's just as easy to
later find yourself unable to fulfill it.
WHENEVER POSSIBLE, PHRASE QUESTIONS FOR A POSITIVE ANSWER. It is
a good maneuver to get others in the habit of saying yes.
EE FLEXIBLE. A minor compromise may pave the way to winning a
major point later.
DON'T WASTE PEOPLE'S TIME — INCLUDING YOUR OWN. Identify each
person's timetable and try to operate within it. You'll find thern
appreciative and cooperative.
DON'T WORK OTHERS. A fast way to bring any meeting to an end is
to suggest work for someone else.
MAKE ALL TERMS SPECIFIC. Never suggest a range of values — the
other side will automatically assume that you agree to the least
of them.
EACH DAY MEANS A NEW ATTEMPT. When negotiations take several
meetings, don't be surprised if areas previously agreed upon are
to be reopened or retraded. There has been time to sleep on it
and people repeatedly change their minds.
DOM1T WORRY ABOUT THE END RESULT. If you concentrate on your plan
and handle yourself well, the end result will see to itself.
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Negotiation Planning and Preparation Outline
I. PLANNING
A. Purpose of planning: To establish certainty for
control of the negotiation
process.
B. How to Prepare - Three Basic Steps:
Determine the facts: Obtain information on
those things out of your control; then do a
reality check.
Analyze the information: Determine tools and
limitations on your ability to negotiate.
Establish negotiation strategy: Establish
certainty for things within your control.
C. Six Questions To Ask Yourself as you prepare and plan:
WHO? WHY? WHAT? WHEN? WHERE? HOW?
D. Identify Mutual Interests:
1. Make a list of the interests of each side - each
party's concerns and desires
2. Then identify all mutual interests of both parties
E. Identify Mutual Risks
1. Make a list of the risks to each side if negotiations
fail
2. Then identify the mutual risks to both parties
Step 1 -
Step 2 -
Step 3 -
F. BATNA -
What is your Best Alternative To A Negotiated
Agreement, _i-£-# what is the best thing each
side can do if negotiations fail?
G. Objective Criteria -
What objective criteria or fair standards exist
outside this particular dispute that can be used
as a yardstick for judging this dispute?
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-2-
II. STRATEGY
A. Substantive
1. Information
a. Ask questions at the negotiating table for
information not ascertainable elsewhere.
b. Disclose information to other side that tells
them what they don't know about the case that
shows our stresngth in bargaining and their
weakness. Aiwa
2. Proposals - They must be credible and are part of a
total package. Know your proposals before
you sit down to negotiate
a. Opening - Your highest justifiable opening position
b. Fallback - (Establish before negotiations begin)
c. Trigger position - A check point just above the
bottom line
d. Bottom line - Lowest acceptable position and point'
for termination of negotiations
3. Psychological Strategy
a. Decide who should make the first offer
b. Develop ways to LOWER THE OTHER SIDE'S EXPECTATIONS
c. Decide on concessions to be made as bargaining chips
c. Plan for flexibility
d. Prevent surprise to your team
B. Procedural
1. Internal team rules:
a. Designate spokesperson(s), notetaker, and
silent observer
b. Decide on means for communication within your team
c. Agree on team decisionmaking method
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-3-
<3. Plan for breaks/caucuses - how often and why
e. Plan for communication within your vertical
hierarchy (superiors, HQ, DOJ)
2. Plan how to deal with the other side
a. Plan means to "break the ice" in an initial
meeting before substantive discussions begin
b. Negotiate agenda, timing, and groundrules at
the outset
III. FINAL REMINDERS FOR THE NEGOTIATION
A. Be serious (non-frivolous) at all times. Your
overall demeanor will influence how the other side
accepts you and reacts to you.
B. Strive to lower the other side's expectations.
C. Keep your vertical hierarchy informed as negotiations
progress.
D. Strive to preclude surprise to your team and to
maintain flexibility.
E. Plan, Plan, Plan.
F. Always keep in mind that—
When you FAIL TO PLAN
YOU Should PLAN TO FAIL
(Good Luck 1)
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•1
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Negotiation Strategy
INTERESTS1
GOVFRNMENT
DEFENDANT
• Obiective is to identify mutual or common interests for a settlement.
-------
Negotiation strategy
PISKS IF SETTLEMENT NOT PEACHED
GOVERNMENT
DEFENDANT
* Oblective is to identify mutual or common risks if settlement
is reached
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Negotiation Strategy
BEST ALTERNATIVES TO NEGOTIATED AGREEMENT
(BATNAS)
GOVERNMENT
(Examples)
1. Refer case to DOJ
Pile case In Court
Accelerate discovery
2.
3.
4.
Pile Summary Judament
Motion
5. Amend complaint to
increase penalties
DEFENDANT
(Examples)
1. Continue to Install
equipment and return
to compliance so that
Gov't has a penalty
only case.
2. Close facility
3. Bankruptcy
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Negotiation Strategy
OBJECTIVE CRITERIA FOB
JUDGING DISPUTE
(Fxamples)
1. t*eets Statutory Requirements
2. Consistent with National Performance
3. Compare to what similarly situated violators have settled for
ih your Reoion and others for penalties and compliance schedules
4. Relevant iudicial/ALJ schedules
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Negotiation Strategy
ADDITIONAL INFORMATION NEEDED
TO BF OBTAINED FROM INDEPENDENT SOURCES
WHAT SOURCE WHEN
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Negotiation Strategy
ADDITIONAL INFORMATION NEEDED
OBTAIN FROM OTHER TEAM
WHAT WHEN
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Negotiation Strategy
INFORMATION TO CONVEY TO OTHER TEAM
DURING SETTLEMENT NEGOTIATIONS
WHAT
WHEN
-------
SCHEDULE
POSITION JUSTIFICATION
OPENING
PALL BACK
II
PALL BACK
*7
BOnTOMLINF
-------
OPENING
STIPULATED PENALTIES
POSITION JUSTIFICATION
PALL BACK
II
PALL RACK
«2
BOfTTOMLINF
-------
UPFRONT PENALTIES
POSITION JUSTIFICATION
OPENING
FALL BACK
»1
FALL BACK
«?
BOflTOMLINE
-------
OTHER
POSITION JUSTIFICATION
OPENING
PALL BACK
•1
PALL BACK
<2
BOttTOMLINE
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CONFIDENTIAL
YOUR TEAM'S SETTLEMENT PROPOSALS
COMPLIANCE
SCHEDULE
UPFRONT
PENALTIES
WHEN
STIPULATED
PENALTIES
FORCE
MAJEURE
DISPUTE
RESOLUTION
OTHER
OPENING
POSITION
PALL PACK
II
•ALL BACK
»?
30TTOMLINF
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CONFIDENTIAL
OTHER TEAM'S (ANTICIPATED) SETTLEMENT PROPOSALS
COMPLIANCE
OPFNING
POSITION
SCHEDULF
UPFRONT
PENALTIES
WHEN
STIPULATED
PENALTIES
FORCE
MAJEURE
DISPUTE
RESOLUTION
OTHER
FALL BACK
tl
FALL PACK
12
BOTPOMLINR
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Negotiation Strategy
INTERESTS'
government
DEFENDANT
• Obiective
is to identify mutual or common interests for a settlement.
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Negotiation Strategy
RISKS IF SETTLEMENT NOT REACHED
GOVERNMENT
DEFENDANT
• Objective is to identify mutual
is reached
or common risks if settlement
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Negotiation strategy
BEST ALTERNATIVES TO NEGOTIATED AGREEMENT
(BATNAs)
GOVERNMENT
(Examples)
1. Refer case to DOJ
2. Pile case in Court
3. Accelerate discovery
*
4. File Summary Judgment
Motion
*>. Amend Complaint to
increase penalties
DEFENDANT
(Examples)
1. Continue to install
equipment and return
to compliance so that
Gov't has a penalty
only case.
2. Close facility
3. Bankruptcy
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OBJECTIVE CRITERIA FOP
JUDGING DISPUTE
(Fxamples)
1. Meets Statutory Peouirements
2. Consistent with National Performance
Negotiation strategy
3. Compare to what similarly situated violators have settled for
ih your Peaion and others for penalties and compliance schedules
4. Pelevant iudicial/ALJ schedules
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Negotiation Strategy
ADDITIONAL INFORMATION NEEDED
TO BF OBTAINED FROM INDEPENDENT SOURCES
WHAT SOURCE WHEN
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Negotiation Strategy
ADDITIONAL INFORMATION NEEDED
OBTAIN FROM OTHER TEAM
WHAT WHEN
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Negotiation strategy
INFORMATION TO CONVEY TO OTHER TEAM
DURING SETTLEMENT NEGOTIATIONS
WHAT WHEN
-------
SCHEDULE
POSITION JUSTIFICATION
OPENING
FALL BACK
II
FALL BACK
*7
BOTTOMLINF
-------
OPENING
STIPULATED PENALTIES
POSITION JUSTIFICATION
PALL BACK
U
PALL RACK
*2
BOTTOMLINF
-------
OPENING
UPFRONT PENALTIES
POSITION JUSTIFICATION
FALL BACK
»1
FALL BACK
»?
BOTTOMLINE
-------
OTHER
POSITION JUSTIFICATION
OPENING
PALL BACK
II
PALL BACK
42
BOTTOMLINE
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CONFIDENTIAL
YOUR TEAM'S SETTLEMENT PROPOSALS
UPFRONT STIPULATED FORCE DISPUTE
1
COMPLIANCE
SCHEDULE
1 PENALTIES 1
WHEN
1 PENALTIES 1
MAJEURE
1 RESOLUTION
OTHER
'FNING 1
1 1
1 1
1
>SITION 1
1
1
1
1
1
1
1
1
1 1
1 1
1 1
1 1
1 1
1 1
I 1
1 1
1 1
1 I
1 1
1 1
1 1
1 1
1 1
1 1
1 1
1 1
1 1
1
1
1
1
1
1
1
1
1
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tLL PACK | 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 I 1 1 1 1 1 1
1 | 1 1 1 1 1 1
1 1 1 1 1 1 I 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 t 1 1
LL BACK 1 1 1 1 1 1 1 1
t 1 1 1 1 1 I 1
1 I 1 1 1 1 1 1
1 I 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
I 1 t 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
TTOMLINF |
1
1
1
1
1
1
1
1
1 1
1 1
1 1
1 1
I 1
1 1
1 1
1 1
1 1
1 1
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1 |
1 1
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1
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1
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1
• ill
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CONFIDENTIAL
OTHER TEAM'S (ANTICIPATED) SETTLEMENT PROPOSALS
UPFRONT STIPULATED FORCE DISPUTE
COMPLIANCE |
SCHEDULF
PENALTIES 1
WHEN
1 PENALTIES
MAJEURE
(RESOLUTION
1 OTHER
OPFNING |
1
1
1
POSITION |
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
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1
PALL BACK 1
1
1
1
#1 1
1
1
1
1
1
1
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1
1
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FALL PACK |
1
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• 2 |
1
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1
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1
1
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1
1
1
1
1
1
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BOTTOMLINR 1 I I 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
1 1 1 1 1 1 1 1
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PUMP N' DUMP
General Instructions for Negotiation Planning Exercise
The mock negotiations exercise, to be conducted between two
EPA representatives and two representaindustrial
waste hauler and disposer, consists of<^two sessiojfes. The company
has requested the commencement of sett leitrerhfe--dirscus scions. First,
the EPA and company teams will meet separately to prepare and
plan as they deem necessary. Team preparation sessions are
scheduled for 45 minutes. The second session is a 45-minute
settlement conference seeking resolution of the action prior to
trial, and will begin promptly at the time assigned.
Participants will be assigned to specific roles within EPA or
Company teams. Each participant in the exercise will receive
two sets of information:
(1) All participants will receive the attached Fact Sheet
for Negotiation Planning Exercise.
(2) Each EPA and company team member will receive a
statement describing the specific role each will play in
the negotiations.
Participants should use only the information provided in
these materials along with their general knowledge of RCRA and
EPA/DOJ policy and regulations. Logical inferences may be drawn
from the facts, but only with the agreement of the opposing team
as to each inference. Participants should make every effort to
faithfully represent the positions of the individual role
characters assigned to them.
The objective of the exercise is to reach a settlement
consistent with the interests of the parties by the end of the
negotiation session. Failure to obtain substantial agreement on
all disputed issues will require the cessation of further
settlement discussions due to pending trial activities. The
session is to be terminated promptly at the time assigned whether
or not agreement on settlement has been reached. A faculty
member may attend team meetings and negotiations session as a
passive observer. The observer will not participate in team
activities or negotiations, nor will he/she answer any
substantive questions regarding the fact situation.
In regard to civil penalties, the Agency approach is to
calculate them using ajiystep process. First calculate economic
benefit of noncompliance. This is usually done using BEN, the
Agency'~s~~aser^friendly computer model. This has already been
done for you in this simulation. (The Agency's policy is to
recapture 100% of the benefit). The second step is to calculate
the gravity of the violation. This is done by applying the
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2
applicable medium-specific penalty policy. This simulation
involves RCRA and an excerpt of the RCRA penalty policy is
included. The third step is applying adjustment factors as
appropriate. This is covered in the applicable the medium-
specific penalty policy. In order to simplify this example, we
have not included the RCRA adjustment factors. You are free to
make adjustments as you see fit.
A~-V~
rvi iw'v
o
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Fact Sheet For Negotiation Planning Exercise
A. The Company
Pump 'N Dump, Inc. (P&D) is a company which hauls industrial
wastes and disposes of them on its own property. It has been in
business about 20 years, operating in the State of Maryland. P&D
is a closely held, family operated business employing 10 people.
P&D's gross revenues are about $400,000 per year, and its assets
are slightly less than $100,000.
B. The Violations
EPA inspected P&D's operation recently in response to a tip
from a disgruntled employee. The inspector observed the
following problems with P&D's operation:
the facility failed to obtain and analyze water
samples, a violation of 40 CFR §265T927
the company failed to keep any records^.on
groundwater quality and failed~to"_submit reports to
EPA^ a violation~of 40 CFR §265.94.
The cost of constructing acceptable monitoring wells was
recently estimated at $25,000. The cost of operating and
maintaining the wells was also recently estimated at $2,000. The
owner of P&D said that it would cost the company $25,000 per year
to perform appropriate sampling and analysis and issue a report
on groundwater quality. The company has been in violation of the
groundwater monitoring requirements for almost 7 years. P&D
expects to be in compliance in four months.
C. Regulatory History
P&D has had two environmental violations prior to this
occurrence. Both were for RCRA recordkeeping violations about
two and three years ago, respectively.
D. Status of the Case
EPA has issued a complaint and expects a hearing to follow in
about 60-90 days. Since the initial contact with the Company,
/Til nrS
Manifests for the wastes were incomplete, a
violation Of 40 CFR §263.22;
the facility failed to install a groundwater
mnnitnrinq system, a violation Of 40 CFR §265.90;
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2
P&D Mas begun placing the wastes in approved containers and
drilling monitoring wells. The company has answered the
complaint denying all allegations. Neither side has initiated^
any discovery. EPA's complaint requests a penalty of\$2£oT5SO^
You have calculated the civil penalty figure using EPA's RCRA
penalty policy and the BEN computer program, and the penalty
totals etaatf: $220,550 for the complaint. The most conservative
calculation of economic benefit using BEN is $21,603. The most
aggressive calculation of economic benefit is $179,303. EPA has
had approximately 10 cases with similar violations, and the
penalty amounts assessed ranged from $50,000 to $250,000.
P&D is represented by outside counsel from the firm of Slash
and Burn who has contacted EPA to try to settle the matter.
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- 10 -
C. Penalty Assessment Matrix
Each of the above factors--potential for harm and extent
of deviation from a requirement--forms one of the axes of the
penalty assessment matrix. The matrix has nine cells, each
containing a penalty range. The specific cell is chosen after
determining which category (major, moderate, or minor) is appro-
priate for the potential for harm factor, and which category is
appropriate for the extent of deviation factor. The complete
matrix is illustrated below-.
Extent of Deviation from Requirement
MAJOR
MODERATE
MINOR
Potent ial
for
Harm
MAJOR
$25,000
to
20,000
$19 ,999
to
15 .000
$14,999
to
11,000 "
MODERATE
$10,999
to
8 ,000
$7 .999
to
5 .000
$4,999
to
3,000
MINOR
$2,999
to
1 ,500
$1,499
to
500
$499
to
100
The lowest cell (minor potential for harm/minor extent of
deviation) contains a penalty range from S100 to $499. Provi-
sion for this low range of penalties has been made because the
assessment of low penalties has proven to be an effective com-
pliance tool. The highest cell (major potential for harm/major
extent of deviation) is limited by the maximum statutory penalty
allowance of $25,000 per day of violation.
The selection of the exact penalty amount within each cell
is left to the discretion of compliance/enforcement personnel in
any given case. Compliance/enforcement personnel should be
careful to consider the seriousness of the violation only in
selecting the penalty amount within the range. The reasons the
violation was committed, the intent of the violator, and other
factors related to the violator are not considered at this point;
they will be considered at the adjustment stage.
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U.S. v. ATC
General Instructions for Negotiation Exercise
The mock negotiations exercise, to be conducted between
five government representatives and five representatives of a
manufacturing company, consists of two sessions. The company
has requested the commencement of settlement discussions. First,
the government and company teams will meet separately to prepare
and plan as they deem necessary. Team preparation sessions are
scheduled for about one hour prior to the lunch break of the
second day of the course. Any additional team preparation is
left to the initiative of team members. Each team may engage in
pre-negotiation discussions with the opposition team as it determines
necessary during the lunch break. The second session, which
will follow the lunch break, is a two hour settlement conference
seeking resolution of the filed civil action prior to trial.
Participants will be assigned to specific roles within govern-
ment or company teams prior to the negotiation preparation session.
Time is set aside for the faculty members to lead feedback
discussions at the end of the exercise.
Each participant in the exercise will receive four sets of
information:
(1) Instructions for sessions #1 and 2.
(2) All participants will receive the General Facts
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for Negotiation Exercise. Each participant should
be familiar with the general fact statement prior
to the beginning of the team preparation session.
(3) All government representatives will receive a U.S.
Position and Fact Sheet with a list of issues of
primary importance to the government. All company
representatives will receive an ATC Position and
Fact Sheet with a list of issues, which may or may
not be different from those of the government.
~~Participants should NOT show their position-
fact sheets to representatives of the
other side.
(4) Each government and company team member will
receive a statement describing the specific role
each will play in the negotiations.
~~Participants should NOT show these role
statements to anyone including team
members, but may disclose information to
team members or the other side as they
act out their role in the exercise.
Participants should use only the information provided in
these materials along with their general knowledge of the clean
Water Act and EPA/DOJ policy and regulations. Logical inferences
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may be drawn from the facts, but only with the agreement of the
opposing team as to each inference. Participants should make
every effort to faithfully represent the positions of the indivi-
dual role characters assigned to them.
The objective of the mock negotiation exercise is to reach
a settlement consistent with the interests of the parties by the
end of the negotiation session. Failure to obtain substantial
agreement on all disputed issues will require the cessation of
further settlement discussions due to pending trial activities.
This negotiation session is the last opportunity to settle this
case. The pretrial hearing has been held, and the judge has
scheduled the trial for next Monday. There will be no further
opportunities for negotiation prior to trial.
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Instructions for Session #1
NEGOTIATION PREPARATION MEETING
A meeting of the negotiating team for each side has been
called by the regional attorney and the corporate counsel re-
spectively. He or she is responsible for running the meeting
and ensuring that the team is well prepared for the subsequent
settlement conference.
One hour and 15 minutes is set aside for the negotiation
preparation meeting. A one hour lunch break immediately follows
the meeting. Upon the consensus of team members, the lunch
period may be used in any manner deemed appropriate. However,
the Settlement Conference will begin promptly at the time assigned.
To maximize use of the limited time for team preparation, the
team should begin the preparation meeting with agreement on an
agenda budgeting time for discussion and resolution of preparation
items.
A faculty member will attend each team meeting as a passive
observer. The observer will not participate in team activities,
nor will he/she answer any substantive questions regarding the
exercise fact situation. The observer will be required to leave
the team meeting at the beginning of the lunch break.
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Instructions for Session #2
SETTLEMENT CONFERENCE
After lunch, participants should go to the room assigned for
the final session: The Settlement Conference. The session is
to commence promptly at the time assigned whether or not a faculty
member is present. One or more faculty members will attend each
negotiation session and related caucuses as passive observers.
The observer will not participate in team activities nor will
he/she answer any substantive questions regarding the exercise
fact situation.
The conduct and timing of the negotiations is left to the
agreement of the parties. The session is to terminate promptly
at the time assigned whether or not agreement on settlement has
been reached. Negotiating teams will have only two hours
to reach an agreement.
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General Facts For Negotiation Exercise
The following facts are shared by all participants in the
negotiation exercise.
The Company
American Titanium Corporation (ATC) is a Fortune 1000 com-
pany with gross revenues of approximately $200 million per year.
The company's interests include mining, metallurgy and inorganic
chemical manufacture. The company owns mines producing ilmenite,
a titanium ore; plants for manufacturing titanium-based pigments
and other products; and a metallurgical foundry which produces
titanium alloys. ATC produces over 72 percent of the nation's
output of titanium dioxide, a bright white pigment, well suited
to modern latex paints. The company underwent a major expansion
about 3 years ago. It sought to exploit its strong position
in the pigment field by moving into the paint manufacturing
business. The effort was a failure. The company recorded losses
of $27,000,000 and $13,500,000 respectively, in the past two years.
It attributed those losses to the paint manufacturing fiasco.
Although it has divested itself of its paint manufacturing
investments, ATC is still in shaky financial condition.
The Plant - Process and Products
The facility in question in this case is ATC's 40-year old
manufacturing facility ("the plant") which is located twenty
miles west of St. Louis on the banks of the Missouri River. The
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plant is situated on 10 acres of land. The manufacturing facility
and related buildings cover the entire acreage leaving no room for
further expansion. All land adjacent to the plant site is either
heavily developed or in a flood plain (See attached Site Map).
The plant which employees 900 people, produces titanium dioxide,
a key ingredient in paints, porcelain enamels and plastics.
Approximately 40 percent of the plant's output is highly refined
titanium dioxide, which goes to ATC's Chicago Foundry where it
is used in the production of specialty titanium alloys. The
plant, which operates 24 hours a day, seven days a week, produces
titanium dioxide from ilmenite ore from ATC mines and iron/titanium
slag. The company purchases iron/titanium slag on the open
market.
Water Use and waste water
The plant draws water from onsite wells for process water
and discharges its waste stream (approximately 2 million gallons
per day) to the Missouri River. Pollutants in the plant's
discharge include titanium, iron, total suspended solids (TSS),
and low pH (acidic).
Regulatory History
EPA has the permitting and enforcement authority under
the Clean Water Act for discharges within the State of Missouri.
The Permit
The company's most recent permit establishes BAT effluent
limitations for the discharge of the following pollutants:
Total Suspended Solids (TSS), heavy metals, and pH. The established
-------
effluent limitations are much more stringent than those in the
company's prior NPDES permits. The permit also requires ATC to
report its compliance with permit limitations to EPA on quarterly
Discharge Monitoring Reports (DMR).
Compliance History
ATC's present wastewater treatment system consists of a
settling pond which covers 1/2 acre to a depth of five feet and
utilizes the manual addition of flocculation agents. For the
past year, OMRs submitted to EPA indicate that ATC has contin-
uously exceeded the BAT effluent limits of its permit. ATC's
DMRs reported to EPA indicate typical discharges of TSS, heavy
metals and pH at levels which exceed permitted effluent
limitations by 100%.
Four months ago, EPA issued a Notice of violation (NOV) to
ATC for violations of all the limitations of its BAT permit
noted above.
The Civil Action
Two months ago, at the request of EPA, OOJ filed a civil
action against ATC pursuant to the Clean water Act. The filed
civil action alleges violations by ATC of the terms of the BAT
permit. The case has been assigned to Judge Harold Solomon. The
company has filed its Answer and each side has completed initial
discovery. A stipulation of facts, signed by. both parties, has
been filed establishing the validity of the permit and EPA's juris-
diction to file action to enforce permit requirements. A pretrial
conference with Judge Soloman has been held, and the trial is
scheduled to begin on Monday. The company has requested a final
negotiating session to attempt to settle the matter.
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-4-
Compliance Data
DMRs were regularly submitted by ATC as required by the permit.
The company has not taken any steps to install control equipment
beyond the existing settling pond. The company's DMRs indicate
that the plant has exceeded discharge limitations an average of 28
days per month for the past year.
In addition to the monitoring reports, EPA has data from a
15-day EPA sampling inspection at the ATC plant 3 months ago which
indicates concentrations of pollutants in amounts similar to those
reported by ATC in its DMRs.
Control Options
According to a recent ATC consultant's report available to both
parties, installation of a larger settling pond, neutralization
basin and aeration equipment is the standard BAT technology which
would enable the plant to comply with permit limits. There is
no technical dispute on this issue. The report estimates that
installation of this standard BAT equipment would require one to
two years, depending upon factors such as equipment availability,
work force reliability, intensity of labor effort, equipment
selected, amount of retrofitting and repiping, etc., and should
entail capital costs of between $2,000,000 and $4,000,000 divided
about equally among the three items. The report estimates that
installation of BAT equipment would require between 1 and 2
acres of land.
Control could also be achieved by recycling all wastewater
through retrofitting of inplant process equipment and use of the
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-5-
present settlement pond. Recycling would eliminate all discharges
to the river. Recycling would cost between $8,000,000 and
$10,000,000 at an existing plant like ATC's, would require no
additional land, and would take at least two years.
Recent Communications
In a letter to EPA dated four months ago, ATC argued that it
cannot meet the BAT effluent limitations in the permit for several
reasons: (1) insufficient land for installation of standard BAT
treatment equipment, and (2) insufficient money to install the
recycling option. In fact, unless granted a compliance schedule
of at least two years in duration, ATC claimed that even the
standard BAT treatment option would bankrupt the financially
beleaguered company. ATC also argued that, as is undisputed by
EPA, there had been no evidence of water quality violations in
the river since installation of the settling pond.
EPA's response dated two months ago, rejected the company's
position. It noted: (1) that the company has failed to install
BAT treatment, (2) that other similar permittees in the area had
installed appropriate treatment equipment, and (3) that the clean
Water Act required compliance with both water quality standards
and effluent limitations so compliance with water quality standards
is not a legal defense to permit violations.
Penalty
The maximum statutory penalty is $3,360,000.
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Other information
Citizen complaints about the plants discharges have increased
over the last two years. The area downstream of the plant, has
become built up, primarily with residential developments. The
complaints all address the intermittent discoloration of the river
which is noticeably reddish gray for a distance of almost a mile
downstream of the ATC discharge.
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SITE MAP
MX PLKNT
S«Tt Slit - 10 *<»«.*
TiT^lv)^ OtO^tOl
HKNV)fKC.TVlk« AG
PLKI4T V
Xh
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7
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EPA Negotiation Skills Training
NONVERBAL COMMUNICATIONS
GESTURE CLUSTERS
Open
Sincere
° Palms of hands exposed
° Open, unbuttoned jacket
° Shoulder-shrug w/open
hands, palms up
Evaluating
Nervous
Uncertain
Accepting
° Moving closer
° Hands to chest
Receptive
Interested
Head tilted to side
On edge of seat, ready to
rise, palms open on
thighs or elbows on
thighs & hands hanging
loose
Mirroring (copying other's
gestures)
Hands on hips
Unbuttoning jacket
Leaning forward/on edge
of chair
Uncrossing legs
Moving closer together
Rubbing palms together
(expectancy)
° Hand closed and resting
on cheek (positive)
° Stroking chin
0 Pacing (positive)
° Pinching bridge of nose
® Chin in palm, index finger
extended along cheek,
other fingers below mouth
(critical evaluation)
° Sitting back (critical)
Bored
Disinterested
° Eyes closed for second
or more
° Head supported in palm of
hand
° Finger/foot tapping
° Blank stare
° Doodling
0 Leg over arm of chair
Partial or disguised
arm-cross (e.g. hand to
other elbow)
Ankles crossed and lock.ec
together
Gaze averted upward or
away
Hand over mouth while
speaking
Clearing throat,
whistling
Fidgeting in chair
Touching/rubbing nose
Turning sideways to
show silhouette
Rubbing ear or eye
Ear pulling (may mean
listener wants to
interrupt)
Deceptive
Adapted rrara:
How to Read a Person Like a Book by Gerard I. Nierenberg
Signals by John Pease
° Hand over mouth
° Touching/rubbing nose
° Rubbing eye while
looking away
° Avoiding direct gaze
° Incongruency (e.g.
smiling while
belligerent)
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-2-
Frustrated
° Arms spread w/hands
gripping edge of table
0 Rubbing back of neck
° Taking short breaths
° Tightly clenched hands
° Wringing hands
c Fists (often concealed)
° Pulling collar
0 Kicking ground
Negative
Defensive
° Arms crossed over chest
(also, legs crossed,
but not so strong a
negative as arm-cross)
0 Hands clasped in front
of body
° Standing w/leg crossed
0 Head down
° Moving body away
° Throwing down eyeglasses
Hostile
° Glancing sideways while
frowning
° Anns crossed over chest
with fists clenched
° Clenched fists
° Pointing index finger
Dominant
Aggressive
0 Thumbs displayed (e.g.
hands in pockets w/
thumbs out)
0 Seated, straddling back
of chair
0 Leaning toward you and
speaking in confiden-
tial tone
0 Handshake: turns your
hand so his/her palm
is on top
0 Elevating oneself
(e.g. standing up)
Superior
Confident
° Eyes closed with head
tilted back
0 Steepling (palms
facing, fingertip-to-
fingertip)
° Hands clasped behind
back
0 Hands clasped behind
head and leaning back
• Hands on hips
0 No hand-to-face
gestures
0 Longer and more
frequent eye contact
Stalling for Time n
° Cleaning eyeglasses
0 Earpiece of eyeglass
frame in mouth
Anxious to End
° Feet/Body pointing
toward exit
Territorial Rights
° Feet on chair, desk,
etc.
0 Placing an object (e.g.
briefcase) on space
Self-control
(restraining negative)
° Arms behind back w/one
hand gripping the othr
wrist
0 Ankles locked together
while hands clenched
Reassuring
Oneself
° Clenched hands and
thumbs rubbing together
° Chewing/sucking pen,
pencil
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I
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THE ENVIRONMENTAL LA W INS TIT OTB
FUNDAMENTAL PKDfCXPLEB OP NEOOTIATIONi
A Qiida for EPA Officials
Jeffrey Q. MU1« Thomas R. Colosi
and the
Staff of tho Environmental Law Institute
Copyright 1987
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TABLE OF CONTENTS
INTRODUCTION 1
- Few Rules i
- No Right Settlement 1
- Negotiation Is Not Selling Out 2
- Negotiation Is Not the Antithesis of Litigation 2
- Negotiation May Provide the Best Solution 3
- Learning from Books and Experience 3
- Establishing Trust and Managing Expectations 4
- Creating Doubt 5
- Identifying All of the Negotiations 5
I. MANAGING NEGOTIATIONS 5
A. Unman aged Negotiations 6
- The Case of the Urunanaged Negotiations 6
B. Preparation 11
1. Importance of Preparation 11
- Consequences of Inadequate Preparation 12
2. Constituting the EPA Negotiating Team 13
3. Preparing the Team 14
4. Substantive Preparation 14
- Investigating the Opposition 14
5. Moving Into the Negotiation 15
- Preparation with Other Team Members 16
C. Managing People 17
1. Team Management 17
- Team Decision Making and Dispute
Resolution: Effective Caucusing 18
2. Managing the EPA Vertical Hierarchy 19
3. Managing Other Players 21
- Players at the Table 21
- Players Not at the Table 22
D. Managing Timet The Importance of Deadlines 23
E. Managing the Process 25
1. Projecting Power 25
2. Controlling Significant Functions 26
- Selecting the Meeting Place 27
- Arranging the Players 28
3. Effective Bargaining 28
- Managing Expectations 29
- Managing Concessions 31
4. Managing Public Pronouncements 32
D. EPFECTIVE COMMUNICATIONS 33
A. Negotiating Style and Attitudes 33
B. Effective Listening 34
- Listening Tips 35
C. Effective Penuaslon 36
- Argument and Questions 36
- Facts 37
- Unchallenged Assumptions and Assertions 37
m. CHANGING POLICIES AND FACES 38
A. The Problem 39
B. What Can You Do? 40
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INTRODUCTION
All of us negotiate at some level every day. Each of us brings individual
experiences, strengths and weaknesses to the negotiating table. As a result, some are
naturally better negotiators than others. Many would like to improve their negotiating
skills. But negotiation is taught in few schools and many of the popular books on the
subject contain as much hype as anything else. Indeed, can negotiation be learned? Can
it be learned from reading? Can reading about negotiation'serve any real purpose?
- Few Rules. "Learning" negotiation, especially from books, is complicated by the
existence of few hard and fast rules for successful negotiation. We discuss most of those
rules and principles in this booklet. Despite the relative absence of negotiating
principles, the negotiation process is a complex one. But much of the complexity of the
process results from the infinite variety of negotiators and of situations in which
negotiations take place. Each negotiation develops a life of its own from differences in
the nature and number of issues to be resolved, the strengths and character of the parties
represented at the negotiating table, and, yes, the negotiating skills of the players at the
table.
- No Right Settlement. Because each negotiation takes on a life of its own, no two
different sets of negotiators are likely to reach the same settlement on a matter of any
complexity. Indeed, EPA participants consistently reached different settlements of the
same hazardous waste enforcement cases in thirty to forty practice negotiation sessions
observed by the authors. This suggests that there may be no "right" settlement for most
negotiations. There may well be, however, ranges in the desirability of various
settlements from the perspective of each side. The absence of a "right" settlement and
the existence of a range of acceptable settlements may disturb the less flexible or the
advocates of narrow interests. Indeed, at times there may be only one solution to a
-------
problem that EPA can accept. When the latter is the case, negotiation is irrelevant —
the solution is simply non-negotiable.
- Negotiating Is Not Selling Out. While neither side to a normal negotiation
ultimately settles for all it had hoped to get before the negotiation began, this is no
indication that it "sold out" on what it hoped to but did not achieve. It may have learned
during the course of the negotiations that its original expectations were unwarranted or
ill founded. It may have traded a less desired item to get a more desired item. It may
have foregone an unnecessary item to secure agreement. But it should not give up what
is essential to it. What is essential to EPA is established by statute, regulation and
policy. Statutory and regulatory mandates are not negotiable by EPA enforcement
personnel and policy directives are usually not negotiable by them. Policy may be
affected, however, by what is learned in a negotiation. It is not the purpose of this
discussion to identify what items, laws and policy may be non-negotiable in one
negotiation or another. That, however, is one task EPA's negotiators must perform in
preparing for each negotiation.
- Negotiation Is Not the Antithesis of Litigation. EPA sometimes threatens to fUe
suit against a violator unless a negotiated settlement is reached by a certain date. To
some this suggests that negotiation and litigation are mutually exclusive processes.
Nothing could be further from the truth. The overwhelming majority of filed cases settle
prior to a trial on the merits — and they settle through negotiation. Some aspects of the
litigation process may help reach negotiated settlements, e.g., getting all the relevant
facts on the table through discovery or stimulating closure on settlements by court
imposed deadlines. Some things about litigation hinder negotiation, e.g., the adversarial
nature of litigation. But negotiation and litigation are not two separate processes for
settling a dispute. Negotiation continues after litigation commences, but it continues
under different ground rules.
- 2 -
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- Negotiation May Provide the Best Solution. In many cases negotiation has great
advantages over administrative or judicial litigation or administrative fiat. It may be
quicker and require devotion of fewer resources. It results in a solution which both sides
are happy with or with which they can at least live comfortably. It enables them to
devise a solution which best fits their needs and the situation at hand. And it enables
EPA to use whatever leverage it may have that would be unavailable in court, e.g., the
power to make or withhold a grant, to initiate or withhold initiation of a contractor
debarment proceeding. Aecordingly, EPA can gain agreement from the other side to
undertake endeavors far beyond EPA's legal authorities to demand or a court's to
impose. And when a solution has been agreed to, it is more likely to be complied with
ungrudgingly and completely than one that is imposed without consent.
- Learning from Books and Experiences. Negotiation, like the advocacy practiced
in litigation, is a process, not a science or a body of learning. Because negotiation has no
rule book and success in any negotiation depends upon the dynamics of that negotiation,
negotiation cannot be learned from a book, only from practice. A book can, however,
assist the negotiator and improve his or her own skills in three very specific ways:
o It can suggest a theory of negotiation, providing a conceptual
framework for viewing and understanding the process and providing
some order to what otherwise appear an unstructured happening;
o It can elucidate the few rules that do exist; and
o It can suggest a number of techniques that are employed by experienced
and suceenful negotiators, illuminating their usefulness and limitations.
This booklet grew out of more than a dozen courses on negotiation presented by the
authors to EPA enforcement personnel around the country. It captures much the
message of those courses and discusses particular problems that participants identified as
common to EPA enforcement personnel. No booklet can duplicate some of the most
- 3 -
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valuable parts of the courses — the time spent negotiating enforcement problems and
subsequent discussions of the process led by faculty observers. These sessions allowed
the participants risk free practice at negotiation, with the benefit from faculty lectures
of a heightened understanding of the process and awareness of how to influence the
process. But the booklet draws on and benefits from the authors' observations of those
sessions. It is oriented to address the problems that EPA participants said they faced in
their jobs. And it addresses problems observed by the faculty in the conduct of the
practice negotiations by the participants. Indeed, in. the practice sections of the booklet,
many of the examples used are drawn directly from observations of the authors at the
practice sessions or in actual negotiation for or with EPA.
- Establishing Trust and Managing Expectations. Incidentally, in telling you at the
outset that you can't learn how to negotiate just from a book and that this booklet does
not duplicate one of the most valuable aspects of good negotiation training courses, we
are accomplishing two objectives. We are telling you the truth, hopefully establishing
trust. And we are lowering your expectations as to what you will learn from the
booklet. Both concepts are essential to the negotiation process.
Establishing trust between negotiating teams is necessary before a settlement is
likely to result. Settlements are basically exchanges of promises — enforceable promises
in an enforcement case, but promises nonetheless. And you don't willingly exchange
promises with people you don't trust. Often you don't even listen to them. It's hard to
reach agreement with someone to whom you won't listen. The relevance of trust is a
little different in regulatory negotiations than in many other types of negotiations. The
regulator may enter into a consent decree with a person not wholly trusted to comply
with it, because the regulator knows the court will enforce it. Nonetheless, both sides to
a regulatory negotiation want the other side to listen to them and be influenced by their
words. That is more likely to happen if they have developed trust between them.
- 4 -
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As we will discuss more fully below, the effective management of expectations
often is necessary for a settlement on terms favorable to your team. If you have done
nothing to manage what the other team expects to get from you, it may expect a lot and
be unwilling to settle for a little. But if you have managed its expectations before even
sitting down at the negotiating table, a little may seem quite satisfactory.
- Creating Doubt. The key to managing expectations is to create doubt as to the
viability of the others' expectations. Indeed, in many respects the job of the negotiator
may be thought of as creating doubts in the minds of others as to the viability of their
positions, assertions and assumptions. This booklet focuses on where to create doubts—
from the viability of agendas and negotiating logistics to assertions and proposals made
during negotiating sessions. It also focuses on how to create doubts—from proper
preparation to better questioning of assertions and proposals^
- Identifying All of the Negotiation. When seeking to establish trust and manage
expectations, it's important to identify all of the sets of negotiations where that is
necessary. A negotiating team not only negotiates with its opposite number across the
table, it also negotiates with its own vertical hierarchy. Its vertical hierarchy is made up
of the chain of command through which the negotiating team reports and which ultimate-
ly must be satisfied with and sign off on the team's results.
I. MANAGING NEGOTIATIONS
Negotiation Is a process. No process has much of a chance for successful fruition
unless it is managed. Onderstandng that is a giant step in improving negotiating
performance. Management falls largely on the negotiation team leaders for each side.
But all participants must cooperate if efficient management is to be achieved.
Management tasks may be conceived as falling into three rough categories: management
5
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of people, time and process. Of course there is considerable overlap between these
categories, but they at least help organize and present thoughts. Beyond these
categories, however, is the overwhelming importance of preparation. Preparation is
inherent in all three categories of tasks and may be the single most important element in
successful negotiation.
A. Unmanaged Negotiations.
Because of the press of time, personnel changes, or a host of other reasons, a
negotiation may be unmanaged in one or more aspects. The following example is an
amalgam of several situations described to the authors by EPA participants in training
courses.
- The Case of the Unmanaged Negotiation. Sam Acosta has just become acting
Chief of the RCRA Enforcement Section. Until now he was in the RCRA State Programs
Section. He fincfe a short action memorandum on his desk from Bill Sanders, a RCRA
inspector. The memorandum recommends that EPA issue an administrative order to a
hazardous waste treatment facility called Treatment Supreme CTS") for interim
authorization security requirement and manifest violations. Sanders wrote that during an
inspection he observed a missing 25* segment of fencing along a highway at the back of
the TS facility. He also noted that TS had failed to note discrepancies on manifests for
75 shipments of one waste stream, where analysis performed by TS did not confirm that
the waste was as represented by the generator. He attached a copy of a draft
administrative order requiring restoration of the fence, prohibiting further receipts of
the waste stream, and assessing a $25,000 penalty. Sanders noted that copies of the
manifests laboratory reports were in the inspection file. Sanders has been IPAed to the
state for a year.
A costa signs off on the action memorandum and sends to his boas. It is eventually
sent to the Regional Counsels office for legal review where it is assigned to Laura
- 6 -
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Smith. Laura's main job at EPA has been to handle the legal aspects of sewage treat-
ment facility construction grants. This is her first enforcement case. She is iretructed
that the program office is responsible for substantive determinations and her role is to
assure the order is legally sustainable, to assist ine program office in any resulting
negotiations and to represent the program office in any subsequent appeals. She reviews
the order and action memorandum. She determines that the violations alleged are
sufficient to support the remedies sought and are supported in the action memorandum.
She compares the draft order with agency guidance and.makes.some changes to conform
it to the guidance. She signs off on the order and it is eventually issued.
Guy Larado, outside attorney for TS, calls Laura to request a conference on the
order, hopefully to negotiate a mutually acceptable resolution. She indicates she must
check Acosta's calendar and they arrange three possible times, depending on Acosta's
availability. She calls Acosta, settles on a date three weeks hence and makes
arrangements to meet with Acosta that afternoon to review the case.
When Laura and Sam meet they review the action memorandum and order. Laura
asks to see copies of Sanders' inspection report and the manifests at issue. She asks
whether they can talk to Sanders, but Sam says he has been IPAed to the state. They
agree that the case seems open and shut and that under EPA*s penalty guidance they can
only agree to mitigate the penalty down to $18,000. They agree that Laura will be the
spokesperson in the negotiations. They tell both of their superiors that they intend to
settle for the sUbrtantive relief set forth in the order and a penalty between $18,000 and
$25,000. Their superiors concur.
As the date for the meeting approaches, Laura attempts to meet again with Sam,
but they are both out of the office much of the time and do not connect. The day before
the meeting she attempts to arrange for a conference room, but they are already
claimed. Instead she arranges to meet in Sam's office, which is larger than hers.
- 7 -
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On the date of the meeting Laura goes to Sam's office five minutes before the
meeting, telling the main receptionist to ring her there when Larado and TS arrive.
Larado, however, is familiar with the EPA office and proceeds directly to Laura's office,
never coming close to the main receptionist. Laura's secretary is not there and no one
knows where she is. Both negotiating teams remain in splendid isolation until Laura's
secretary returns, discovers the situation, and calls Laura.
Laura returns to her office, meets the TS contingent and escorts them to Sam's
office. There are 6 of them: their plant manager, chief chemist, inside attorney, outside
attorney, their customer's plant manager and his attorney. There are only four chairs in
Sam's office. Sam and Laura scurry around to find four more chairs. Sam sits behind the
desk, Laura sits beside it and the TS Supreme contingent crowds in front of the desk,
filling all the space between it and the door. The room is not large enough to hold them
all comfortably.
Laura opens by introducing herself and Sam and inviting the TS contingent to do the
same. She apologizes for the confusion and for the cramped quarters. She then outlines
the violations alleged and the enforcement procedures. She emphasizes the Agency's
view of the importance and gravity of the violations and states that EPA would like to
see if there is a basis for settling the matter. She indicates the substantive violations
must be corrected expeditiously. Finally, she states that "We really would like to get a
penalty of around $18,000 to $20,000."
Guy Larado, the outside attorney for TS, opens with a statement that TS explained
both situations to the EPA inspector when he was on site and believe the complaint is a
mistake. He asks whether the inspector is coming to the meeting. Acoata says the
inspector has been IPAed to the state and is not available. Larado says that is a pity, as
TS has already been through this with the inspector.
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As to the fence, Larado said, t..ere was indeed a 25' section missing the day the
inspector was there. It was missing as the result of an automobile accident on the
highway. It was scheduled for repair within the week and was in fact repaired two days
later. The fence, incidentally, was a 10' high, electrophied, chain link fence topped with
concertina wire, a far more protective fence than was required or was customary in the
trade. He produced pictures of the fence, a notarized affidavit from the repair company
as to when it was repaired, and a copy of a letter to the inspector enclosing copies of the
pictures and affidavit. Sam said that satisfied him that the violation had been
corrected. Laura said that there was still a question of the penalty. Larado said that a
penalty might be legally authorized, but that equitably it should be mitigated to zero
because the hole in the fence had been caused by a third party beyond the control of TS,
TS had scheduled its repair prior to the inspection and had repaired it immediately after
the inspection, and the fence was far better than required by EPA's regulations. Sam
said "I hear you. Let's talk about the manifest violation."
Larado said TS had discussed that with the inspector too. The waste stream in
question was being delisted when the Inspection took place and was subsequently delisted,
so it wasn't a hazardous waste at alL TS's customer said that was right and produced a
copy of the delisting document and accompanying Federal Register notice. Larado said
that TS had written the inspector enclosing a copy of the delisting document and notice.
Laura asked Sam if copies of TS's letters to the inspector were in his files, for they
weren't in hen. He said he didi't know, but looked through his file and found both
letters.
Larado said that TS could argue that since the waste stream was delisted by EPA,
EPA acknowledged that it was never really hazardous waste and, therefore, TS never
really violated the manifest requirements. He said TS would forego that argument for
the sake of settlement, if EPA would acknowledge that, because the waste stream was
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not hazardous, the violations were technical «nd there was no damage done to the
environment or the regulatory scheme and a de minimus penalty, if any, was
appropriate. He offered $2500. Sam said that sounded fine to him, but that the
violations found raised a question as to the integrity of TS's system for handling
manifests and its waste analysis plan. Larado answered that EPA's inspector had found
no other problems but TS would hire an outside auditor to review its system and follow
its recommendations if defects were found. Sam asked if TS would agree to put that in a
consent order and Larado agreed.
Larado said that there appeared to be agreement: they would settle on a $2500
penalty and an agreement to audit TS's manifest system and correct any deficiencies. At
this point Laura said she thought EPA's penalty policy would require more than $2500 for
the admitted violations. Larado said Sam had already agreed to the $2500 figure. Sam
said he hadn't agreed to the figure, only that under the facts a relatively low penalty
seemed appropriate. Larado asked how much and Sam asked Laura whether she thought
$5000 would be enough. She said she didn't know. Larado said TS would write a check
for $4000 and deliver it today to settle the matter. Sam said he didn't see how a
settlement could be done so quickly, since it had to be signed off higher up. They usually
took at least two weeks.
Larado, who to this point had been soft spoken, polite and charming, became red in
the face and began speaking with a louder voice, touched with anger. He protested that
he had spoken at length with the inspector about the importance of a quick resolution of
the matter. TS was about to close a major financing to construct three new state-of-
the-art incinerators elsewhere in the next EPA Region to the east and had to certify a
clean regulatory bill of health to secure the financing. He said the inspector had assured
him that if EPA's negotiators could sign off on a settlement, the matter could be handled
in a couple of days. Larado said he was dumbfounded that EPA would hold up so
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important a matter where it agreed the violations were trivial and of no coreequence.
Sam asked Laura whether she saw any reason not to agree to the settlement
outlined. She said she hadn't really seen enough of these problems to be sure. Sam said
as far as he was concerned the violations, as explained, were technical, the solutions
were adequate, and the penalty appropriate. Laura said he was the client and if he was
satisfied, she was. Larado then drew up a letter agreement which both parties initialed
and Laura agreed to turn into a consent order that afternoon.
That afternoon Laura talked to Sanders, the inspector, by phone. He confirmed
that he had indicated the possibility of quick action if agreement was reached, but said
the agreement was inappropriate. The fence break had indeed been caused by an
automobile accident and had been repaired immediately after the inspection. But the
break had occurred four months previously and the repair was not ordered until after TS
knew an inspection was scheduled. The fence was indeed far better than those around
most disposal facilities. But it had been ordered by the state after previous fencing had
proved inadequate to prevent repeated damage by vandals. TS was correct that the
waste stream involved in the manifest violations was later delisted. But the real
question was whether the shipments received really were of that waste stream or
whether TS had been accepting a non-permitted waste. Indeed, Sandeu wondered
whether he hadn't made a mistake in not recommending action against TS's customer for
sending a waste to a disposal facility not permitted to take it. He was surprised Laura
didn't know this bMUM most of it was in his hand written notes that he was sure were in
the file somewhat*.
At this point, EPA's negotiating team recognized that It was in an embarrassing
situation.
B. Preparation.
1. Importance of Preparation. If any one element is the key to successful
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negotiating, it is preparation. Yet preparation is often skimped b> many negotiators.
EPA enforcement personnel have often complained to the authors about their lack of
time to prepare for EPA negotiating sessions. In the Case of the Unmanaged
Negotiation, the lack of one obvious preparatory meeting with or phone call to the
inspector spelled disaster for the negotiating team because it was blind to the real facts
of the case. Indeed, it hadn't even reviewed all the information in EPA's files. The
undiscovered inspector's notes would have alerted it to the necessity of talking to the
inspector and to the true seriousness of the violations. The failure to do either meant
that the EPA negotiating team could not begin to assess the strengths and weaknesses of
its case.
- Consequences of Inadequate Preparation. Lack of preparation infects many other
aspects of the case. Lack of management preparation was evident in the manner in which
Laura was thrust into the case with no real training in enforcement. The team was
unprepared in all respects, lacking knowledge of the facts, agreed upon objectives and
strategy, and internal rules for the conduct of the negotiation. The latter was evident
when Sam would not allow Laura to be EPA spokesperson despite their prior agreement
that she would be and by Laura's acquiescence in his actions. Lack of internal discipline
and rules was also evident when they openly caucused between themselves on several
issues right before the eyes and ears of TS. This enabled Larado to take control of the
meeting and side with Sain to divide and conquer Sam and Laura.
Lack of proper preparation for the logistics of the meeting led to a mix-up on
where TS went in EPA and cramped, inappropriate negotiating quarters. This
embarrassed Laira and probably made the EPA team prone to make a compensatory
gesture to TS. The fact that Sam and Laura were separated from the door by six
crowded TS team members probably inhibited Sam and Laura from leaving the room to
caucus.
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An unprepared team will rarely achieve as satisfactory of a result in a nef^tiation
as that of e prepared team. Indeed, an unprepared team — as in the Case of the
Unmanaged Negotiation — can achieve a settlement so unsatisfactory that it will be or
should be rejected by the team's vertical hierarchy. The team leader bears the brunt of
responsibility for assuring that the team is well prepared and, if necessary, for
negotiating with the vertical hierarchy for the time and resources necessary for proper
preparation. In the case discussed, the team was so unprepared it didn't really even have
a team leader. Indeed; in a real'sense'all of the failings of the EPA team in that case
can be traced to inadequate preparation. All of the information was readily available to
it to arrive at a completely different settlement. The failure to collect the whole file or
talk to the inspector are obvious in their omission and consequences. Less obvious is the
failure to discover from the EPA region to the east that TS was in the process of getting
permits and money to construct RCRA incinerators and needed an environmental bill of
good health. Knowing this could have given the EPA team leverage to extract what it
wanted as a price of that bill of good health. Instead, the same fact was used against it.
2. Constituting the EPA Negotiating Team. Before the team can manage or
be managed, it must be constituted. The number, experience and personalities of the
team members must be suited to the negotiation at hand and the team members must be
able to work together. Each major legal and technical area likely to be subject to the
negotiation should be well known to at least one team member. The team should be able
to draw on others, m needed, for expertise in particular, more narrow issues.
A team leader must be designated by the vertical hierarchy or agreed upon by the
team. The leader need not have substantive expertise, but should be adept at process and
capable of managing negotiations. Attorneys are oftsn designated as team leaden
because they are trained and are often adept at process. Others can make good team
leaders as welL
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Other roles need to be filled. One team member must take complete notes during
the session. It is helpful to have another be a designated listener and observer, noting
not only what is said, but what reactions the spoken words elicit from members of both
teams and what body language and inflection accompany the spoken word.
3. Preparing the Team. The preparation stage is where the basic work is done to
manage the negotiating team and the vertical hierarchy. The team is chosen, the team
leader and other team roles are designated, and the ground rules for team conduct (when
and how to caucus, how to resolve disputes, etc.) are established. The team works with
the vertical hierarchy to provide needed support, agree on the objectives of the negotia-
tion, and establish an ongoing line of communication.
4. Substantive Preparation. Substantive preparation includes research to
determine what facts and laws relevant to the case are known and unknown and what
additional facts and laws, if any, must be known before the negotiation commences or
concludes. It must be determined whether such facts will be available from the other
side and, if so, whether they will be reliable, or whether they must be gathered
independently. Needed additional factual or legal research must be identified, assigned
and completed. The issues to be resolved must be then identified, together with the
importance of the issues to EPA and the range of resolutions to each that are acceptable
to EPA. Issues on which flexibility and compromise are most easy should be identified.
Finally, the strengths and weaknesses of EPA*s case must be analyzed and their
implications understood.
- Investigating the Opposition. Next, basic intelligence needs to be done on the
opposition and its negotiating team. Who is the opposition? How big is it? How well off
is it financially? How is it structured? How trustworthy is it? How cooperative or
litigious is it? To what pressures is it susceptible? What leverage (enforcement tools,
positive incentives, etc.) do EPA and other governmental departments have over it and
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how can the leverage be used? Can EPA action interfere with the opposition's plans in a
meaningful way (its plans to secure a loan, sell an issue of stock, consummate a merger,
etc.)? What facts does it have? What facts must it make known before the negotiation
can be concluded? What issues does it see and how important are they to it? What are
its underlying needs, interests and assumptions? What are its expectations and how can
they be lowered? What is its likely opening position? How will it react to various
possible EPA demands? What are the strengths and weaknesses of its case and how can
they be exploited?'
As much should be known about the opponent's negotiating team as about the
opponent itself. Who are the team members? What are their backgrounds? What team
roles do they play? What are their styles? How disciplined are they? What weaknesses
can you exploit? What strengths must you anticipate and prepare for? Are they
trustworthy? How do they relate to the opponent's vertical hierarchy?
Intelligence on the other side can be gathered from many places: business
literature, the news media, SEC filings, EPA and other government agency recortfc, etc.
But intelligence should be gathered orally as well, particularly on the opponent's
negotiators. If the opponent is well known, other EPA or Department of Justice
personnel will have dealt with its representatives. State EPA, Attorney General, and
personnel from other state and federal government departments can supplement this
information.
5. Moving into the Negotiation. Now, and only now, is the team in the position to
refine its objectives, develop a strategy to reach the objectives, and develop an opening
position or offer and appropriate fall backs or alternatives. At this stage it is also ready
to draft an agenda and determine what logistical arrangements best suit Its interests.
This is an appropriate time for the team leader to contact the team leader for the other
side to discuss an agenda and logistics. Information should be exchanged at this point on
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the composition of the negotiating teams. If there are significant disparities in the size
or composition of the teams, the team leader may wish to alter the number of members
on the EPA team or to discuss a mutual limitation on the size or composition of the
teams. If there are unfamiliar members of the opponent's team, research should be done
to determine their characteristics and negotiating styles.
- Preparation with Other Team. Preparation with the other team begins before the
first negotiating session and may continue at the commencement of the session with
agreement on an agenda and negotiating rules. The agenda.may be both for the initial
negotiating session and for subsequent meetings. It can involve setting deadlines to
complete different aspects of the negotiation. The agenda is important in a number of
respects. It should surface all of the issues and make it hard to raise last minute
concerns. It should order the proceedings. Issues can be ordered to adcfress more easily
resolved ones initially, in order to build good feelings, a commitment to the process and a
momentum toward settlement.
Other basic rules to govern the course of negotiation should be agreed upon with
the other team at this point: confidentiality of the proceedings; length, frequency and
location of negotiating sessions; etc. Since there are no rules for negotiating, the rules
become whatever the parties agree.
Negotiating agenda and the other process questions can color the whole course of
the negotiations. Early agreement on these items may establish commitment to the
process and momentum toward settlement. A team can conduct itself during this phase
of the proceedings to manage the other side's expectations. "If they were that difficult
in agreeing on an agenda, this will be one long and frustrating negotiation and we're
unlikely to get what we want out of It.*
Of course none of this was done in the Case of the Unmanaged Negotiation. If even
the meat preliminary contact had been made with the other side, some of the mistakes
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made might have been avoided. The EPA team need not have been embarrassed by
having the other team wait in the wrong place for half an hour. Nor would it have been
boxed into a tight corner and unable to caucus if it had known how many were coming to
negotiate for the other team.
C. Managing People.
The first task of the team leader is to identify all of the people that must be
managed. It is a nasty surprise to find that a forgotten and therefore unmanaged partic-
ipant in the process becomes a fly in the ointment when a settlement is almost within
grasp. The main groups the team leader must manage are: his or her own team (both
table team members and those that support it such as inspectors and experts), his or her
vertical hierarchy (branch chiefs, division directors, etc. in the region and headquarters
from ail concerned program and enforcement offices), and outside groups that may have
an interest in or an influence on the outcome of the negotiation (other federal and state
agencies, elected officials, public interest groups, media). And of course the whole point
of the exercise is to manage the other side to the negotiation.
1. Team Management. Team management is necessary both to get the
maximum benefit from the members of the team and to assure that team members don't
inadvertently interfere with the team's effectiveness. Before active negotiation with the
other side begins, the team leader mwti
o assure that each team member is thoroughly prepared in his or her
particular aspect of the case}
o assure that each team member shares his or her knowledge and
experience with the rest of the team;
o lead the team in developing its strategy and tactics} and
o establish the basic rules by which the team will govern itself during
the course of the negotiations.
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The task of establishing the basic rules for the team warrants special emphasis.
Just as there are few rules for negotiating, there are few rules for the conduct of team
members, aside from the necessity for rules, agreement to the rules by team members,
and adherence to the rules. Two sets of ground rules on which the team must agree are:
I) how decisions will be made within the team; and 1) how communications outside the
team will be handled. Often the easiest set of rules for effective negotiation are based
on the principles of decision within the team by consensus, and communications outside
the team by the team leader. As teams grow accustomed to and comfortable functioning
together, these principles may be varied: decision within the team need not be by
consensus in matters all agree are unimportant; different team members may be
spokesmen on matters within their expertise, etc.
- Team Decision Making and Dispute Resolution; Effective Caucusing. As close to
anything as an absolute rule in negotiation is that the team must decide upon its course
of action and resolve differences between team members intwnally rather than before
the other side. This means doing so away from the negotiating table and out of the
negotiating room. It also means agreeing on when to call caucuses and how to signal the
necessity for a caucus without revealing the reason for the caucus to the other side. If
you call a caucus just after members of the other side have made a major factual
presentation, they may deduce that some of the facts presented were unknown to you and
are causing you to reassess your position. This could be of great strategic or tactical
value to them. It, when the team leader wants to caucus or gets a signal from a team
member to caucus, he or she changes the subject under discussion in the negotiation and
calls a caucus a few minutes later, the purpose of the caucus may not be evident to the
other side.
Nothing distinguishes the unprepared, amatew negotiating team from prepared
professionals as much as discussion between team members to resolve internal team
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difference, at the negotiating table. That jives great advantages to the other team: it
can tell who sides with it and who doesn't, who wants to settle and who doesn't, who is
prepared and who isn't. It then can orient its tactics and presentation to support its
friends on the disordered team. Indeed it can do so even while the disordered team is
resolving its differences at the table by directly participating in those discission, by
effectively acting as an uninvited but tolerated participant in the disordered team's
caucus. In the Case of the Unprepared Negotiation, Guy Larado was able to do this while
Laura Smith and Sam Acosta discussed their differences at the table.
Caucusing should be done away from the table and in another room. Whispered
corner conferences may give a sense of security, but are they effective? Whispers often
project to the other team, whose members can easily read the body language of the
corner caucusers. Whispered "yes" or "no11, with accompanying head shakes, for instance,
are easy to discern at a distance. I know one environmental lawyer who has learned to
lip read for reasons other than tc ^ain a negotiating advantage, but the advantage in this
context is clear.
Caucusing is an important tool of team management and can hardly be used
enough. The authors have never seen it used too much. Caucuses aren't just used to
avoid displaying dirty linen at the negotiating table. Their uses are many:
o To regroup after a surprise?
o To let tempers cool;
o To get information or opinions from experts not at the table; and
o To clarify negotiating authority with the vertical hierarchy.
2. Managing the EPA Vertical Hierarchy. During the negotiation training
course we learned that among the moat difficult problems encountered by EPA
negotiators were those involving their vertical hierarchies. All too often they were
untrained and inexperienced negotiators and unwilling to devote the time and attention
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to performing their proper roles in negotiations. This can make it impossible for the
negotiating team to perform optimally. It may be a problem the team cannot
overcome. But it often can be overcome and can usually at least be improved upon with
sufficient effort by the team.
Managing the vertical hierarchy also begins at the preparation stage. Initially the
team leader must identify what vertical hierarchy is involved and how much of the
vertical hierarchy is likeljr to become involved in the case in any real sense. This can be
difficult in EPA where there are multiple hierarchies that may become interested in any
particular matter. Settling a hazardous waste case involving surface water contamination
and issues of statutory interpretation, for instance, may require concurrence from both
regional and headquarters program offices for both RCRA and CERCLA, as well as
regional and headquarters personnel for Enforcement and General Counsel and the
Department of Justice. Some cases will involve the Administrator. Few negotiating
teem leaders will have the organizational stature to orchestrate such an unwieldy and
potentially conflicting set of hierarchies. But he or she can and must identify what part
of EPA's organizational structure should be involved in a case and are necessary to its
resolution. The team leader can then work with his or her own superiors to get other
vertical hierarchies involved productively.
The vertical hierarchy must be managed in a number of respects:
o To assign the right team members;
o To agrae In advance on settlement objectives;
o To provide necessary resources;
o To prevent and rum to the top of the hierarchy or at least to blunt their
potential disruption}
o To provide flexibility in settlement objectives as circumstances change;
and
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o To approve a recommended settlement.
In particular circumstances the vertical hierarchy must provide other support, e.g.
to consider whether an existing general policy should be modified to accommodate a
specific situation. The better the team manages the vertical hierarchy, the more likely
it is to secure the vertical hierarchy's support and agreement when needed.
The vertical hierarchy is managed:
o By communication;
o By keeping it informed of developments; and.
o By gaining its advanced concurrence for positions taken.
Managing the vertical hierarchy often requires more negotiation with it than with the
other side. The techniques used in both sets of negotiations are much the same. The
time and effort spent in internal negotiations is usually more than the time spent at the
negotiating table with the other side. If this sometimes is discouraging, it may help to
remember that this is one of the negotiators' basic tasks and that the same thing is
probably happening on the other side.
3. Managing Other Players. There are two types of other players that must
be managed: those at the table and those not at the table.
- Players at the Table. Often there will be two or more teams at a multi-party
negotiation that share mutual interests. The normal negotiating partner of this type for
EPA is a state environmental agency. When this occurs, EPA and the state may be
viewed together m a loose sort of a negotiating team and managed as such. Managing
this sort of effort Is obviously more difficult than managing an effort that is all under
one roof. But it is doubly necessary to assure that the other side does not divide and
conquer the two agencies.
The two agencies miBt first determine where their common ground lies and what
differences they have, if any. This wQl help them determine how to organize themselves
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and who should be the lead during the negotiation or on what issue during the
negotiation. It will also help them develop negotiating objectives that are mutually
supportive rather than destructive.
- Plavers Not at the Table. There may be "phantom" players in a negotiation,
players that are not directly represented at the negotiating table or in the vertical
hierarchy, but who are nonetheless interested in the outcome of the negotiation and able
to exert an influence on its outcome. This is particularly true with many EPA cases.
The more significant or controversial the case, the more likely and more numerous these
phantom players will be. They can include senators and congressmen, White House staff,
other federal departments, state agencies, special interest groups, the media, etc.
Specific strategies are necessary to deal with each, but the first task is to determine who
the phantom players are likely to be and the extent of the influence they can wield on
the process.
One of the greatest problems with phantom players at negotiations is that the
negotiation process works best and most efficiently in private. Privacy makes it easier
to avoid grand standing, easier to build trust between the parties, and easier to afford
flexibility and to compromise. The greater the role of phantom players, the more likely
the negotiations are to be conducted in a fish bowL While the players are constrained to
treat the course of life negotiations as confidential, phantom players are not. Indeed, it
will often be in their interests to be very public with information on how the negotiations
are proceeding. Their interests may range from merely seeking publicity for themselves
for its own sale*, to embarrassing the agency into changing its position, or possibly to
assuring that no settlement is reached.
The primary management task of the negotiating team with regard to phantom
players is to make sure they know they are not parties to the negotiation and cannot and
will not be treated as such. If appropriate, they can be listened to for their views and be
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assured that their views will be carefully considered. Indeed, they may have information
that will be of value to you in the negotiations. In some instances their opposition to the
terms of a settlement may make it difficult to consummate or, if consummated, more
trouble than it is worth. Perhaps phantom players should be assured that they will be
briefed on the outcome and told how their views were considered and dealt with. But
they seldom should be advised of the course of the negotiation as it develops or be
consulted as decisions are made. Few shadow players will really expect more. But they
will take more if they can get it. The negotiating team must know when and how to say
"no" and have managed the vertical hierarchy so that it will affirm the "no."
Each phantom player must be dealt with on an individual basis. In some instances
their opposition to the terms of a settlement may make it difficult to consummate or, if
consummated, more trouble than it is worth. Generally elected officials seek an
audience with regulatory officials on behalf of a constituent only, to show that he or she
has the power to gain access and is willing to use it for the constituent. Elected officials
will rarely want to become involved in the merits of an enforcement dispute. And even
if they do, they are usually not in a position of great leverage with the Agency.
Sometimes, however, they may be very concerned on a constituent's behalf. And
sometimes they may have leverage.
On the other hand, public interest groups or concerned local citizens will often not
be content with gaining access or having their views aired. Their concerns may go far
beyond the dtapnt* that EPA is negotiating. They may be a force to be reckoned with if
their position hM undeniable merit or if their access to court or the political process is
proven.
D. Managing Time: The Importance of Deadlines.
There is an old lawyer's saying that 90% of cases settle on the court house steps.
The saying makes two points about the timing of negotiations: 1) unmanaged
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negotiations tend to drag on forever; and 2) managing negotiations includes establishing
and adhering to deadlines.
Most people assigned to negotiate the settlement of an environmental dispute have
many other assignments and cannot and are not expected to devote full time to the
negotiations. When the other demands on the time of the negotiating team members
from both sides are added together, there is often no one time really convenient for each
of them to meet. It is no small wonder that if left to their own devices, negotiations
tend to drag on forever, taking months to resolve what could be done in a few weeks of
concerted effort. The deferral of resolution is usually not attributable to bad faith or
foot dragging, although delay often benefits the regulated entity in many ways. Deferral
of expenditures is an obvious benefit. But loss of momentum may make EPA settle on
easier terms just to bring a case to resolution. And EPA may lose the opportunity to
achieve a favorable and speedy settlement when negotiating with a company which is
interested in quickly resolving and terminating a dispute And options may close as the
other side proceed down courses it chooses. Options among remedies narrow, for
instance, as the defendant implements a remedy. Penalty cases become less compelling
as they become stale or when compliance is achieved.
Establishing and adhering to deadlines is the normal method of expediting
resolution of negotiations. The old lawyer's saying that 90% of cases settle on the court
house steps is a reference to the ultimate deadline: the commencement of a trial. Good
time management *—will aim to avoid this deadline and resolve disputes at a much
earlier stage, before the diversion of resources to discovery and trial preparation.
Setting deadlines is easy for EPA in enforcement cases because EPA controls the timing
of enforcement activities! the issuance of orders, the filing of a complaint, the
deposition of a company's CEO, etc. Deadlines should be set for action producing events,
but for reasonable periods of time. They should be set not only for ultimate resolution of
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a dispute, but also (or interim milestones along the way.
Management of milestones during a protracted negotiation may require
considerable judgments the threat to file a complaint if settlement is not reached on a
date certain should not be slavishly adhered to if settlement is close, good progress is
being made, and there is no foot-dragging on the other side. Under such circumstances,
filing the complaint discourages the other side and may result in slackening the pace of
negotiations, because the other side no longer has inducement for quick action and both
sides must divert attention to litigation. At the same time, if deadlines routinely pass
with no follow through with threatened sanctions, deadlines will soon lose their
credibility and usefulness.
E. Managing the Process.
Management of the negotiation process is important for a number of reasons. Good
management can make the process efficient, moving a dispute along to quick settlement
with few diversions. Good management can help the manager improve his team's position
in the settlement.
1. Projecting Power. By appearing to manage the process, the manager is
seen to have power over the process and power is important in negotiations. The side
with the most power should get most of what it wants. Government usually has the most
power in an enforcement negotiation. It has the powers
o To impose sanctions agairat corporations and responsible individuals;
o To grant, dany or delay permits}
o To order monitoring, studies and diseloiure of information;
o To conduct endhaa impactions;
o To make facilities ineligible for government contracts;
o To cause financially damaging publicity; and
o To make life miserable for corporate management generally.
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The authors observed that some EPA negotiators are uncomfortable with asserting
the full power of the government. This often expressed itself in statements such as "We
really would like a penalty of around $X." This, of course, is just what Laura said in the
Case of the Unmanaged Negotiation. While this may sound polite to the speaker, it sends
a mixed signal to the receiver. It is not a demand. It doesn't sound as serious as a
demand. It must mean the speaker really isn't serious. Unexpected politeness in this
context too often will be perceived as weakness and may create a false expectation that
the government will be lenient — in this case, on penalties. Lara do clearly saw it as an
admission of weakness and used it; in part, to drive for a much lower penalty.
Projecting and using power doesn't mean being overbearing or inflexible. Being
overbearing borders on arrogance — it isn't attractive and it breeds resentment and
contempt. Inflexibility needlessly inhibits creative and mutually satisfactory settle-
ments.
Projecting power requires self-confident awareness of the government's interests
and its rights and ability to protect or secure those interests. Power is projected, among
other means, by managing the negotiating process.
2. Controlling Significant Punctlons. Managing the negotiation process
requires recognizing management fwctions and seizing the initiative to perform them or
assign them for performance. Many of those functions have been discussed already.
They include:
o Drafting an agenda)
o Establishing the ground rules of the negotiations;
o Making initial contact with the other side;
o Making introductions and the opening statement at the first negotiating
session;
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o Establishing a schedule for the negotiations with deadlines;
o Appointing a team member as timekeeper;
o Designating a meeting place;
o Arranging for the logistics of the meeting; and
o Drafting the settlement papers.
Drafting settlement papers is often an important method of exerting control and
increasing bargaining position. It places on the other side the burden of raising, arguing
for, and justifying every change, no matter how small, on the other side. There may be
reasons in particular cases not to do this. It may give the other side a false serse of
confidence to be the initial drafter. The other side may have a superlative drafter who is
demonstrably fair and can hasten the process along. On issues where the other side has a
more thorough grasp of important facts, it may save time to have it do an initial draft of
parts of an order relevant to those facts.
- Selecting the Meeting Place. Is the meeting place important? It was in the Case
of the Unmanaged Negotiation. The room was too small to house the negotiators
comfortably. The EPA negotiators were cut off from the door and could not easily leave
the room for a caucus.
The selection of a meeting room can help or hinder a negotiation. It is particularly
important in protracted negotiations. It should be comfortable and conducive to good
com mini cations and hard work. It should not have diversions, excessive noise, foot
traffic, scenery, comfort, etc. If paperwork is to be done at the meeting, it should be
close to the necessary logistical support. It should be close to caucusing areas with
telephones. Location In EPA offices emphasizes the power of EPA as a negotiator. This
can be enhanced by holding the meeting at the UJS. Attorney's office. Other
considerations may be important in particular cases. Negotiations at the site of a
problem may facilitate the understanding and resolution of the problem by the
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negotiators. Meeting on the defendant's territory may make it more comfortable and
easy to deal with. Alternating meetings between the territory of the two teams len
-------
enforced. In the Case of the Unmanaged Negotiation, Laura and Sam could have used the
leverage they had (but didn't know of) from TS's need for an environmental clean bill of
health to get financing for its incinerators. They could have used it to get a substantial
penalty or perhaps a concession beyond EPA's authority to require, e.g., pasting of a
performance bond or performing research on new compliance methocfc.
- Managing Expectations. The importance of properly managing expectations is
most clear when the consequences of mismanaging expectations are understood. In a
number of practice negotiations by EPA personnel observed by the authors, inexperienced
negotiators often sent mixed signals to the other side. In an exercise observed by the
authors, when one EPA negotiating team decided it needed a $50,000 penalty, its lead
negotiator said to the other side, in an almost apologetic voice, "We really would like to
get a penalty of around $50,000." The other side took this to mean the EPA team wasn't
serious about stiff penalties and had no idea of getting anything close to $50,000. It
assumed that agreement could easily be reached in the $10,000 to $15,000 range, the
limit to which it could agree, and went on to iron out technical matters. When penalties
were finally discussed again at the aid of the session, it was shocked to find EPA
unyielding at $50,000. It thought EPA had misled it. One member of the team thought
the EPA spokesman had acted in bed faith. No settlement was reached by the end of the
session. In fact, som- of the technical agreements reached earlier began to unravel.
In the normal case, the other aide already has an expectation with regard to EPA's
initial penalty demand even before it is made: it probably will be more than EPA is
willing to settle for In the end, probably at least twice as much. Knowing this, EPA
should start out with a demand at least twice as high as it is willing to accept and be
adamant about it from the beginning. The other side will hope that it can cut EPA's
demand in half, but it won't be sure it can because of EPA's adamant demands and
justification. Indeed, it will prepare its vertical hierarchy for the bitter pQl of paying
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close to what EPA demamfe. As EPA eventually lets the other side whittle away at the
demand amount, the other side will be pleased with its progress, appear to its vertical
hierarchy to be doing a good job, and will readily agree on a penalty amount, possibly
higher than EPA set as a goal for itself.
If the other side's penalty expectations can be managed by EPA's negotiators, as
suggested above, they can also be managed in a more general manner by EPA's
enunciated policies and public pronouncements. EPA's penalty policy is a significant
effort to manage penalty expectations, both in terms of the general framework by which
penalty amounts will be determined and of the amounts expected to be paid. While the
policy has not created the expectation that EPA will actually recover the economic
benefit of delayed compliance if that benefit is measured in the millions, it has created
the expectation that EPA will seek and secure penalties at a significantly higher level
than in the past. Negotiators may capitalize on this to manage expectations in individual
negotiations. For instance, they can send a copy of the policy to the other side and
request that the other side firnish in advance of the first negotiating session the figures
needed to calculate the benefit of delayed compliance.
If a penalty is expected, the EPA team should make that clear at the outset of the
first negotiating session and should also make dear the range in which negotiations will
take place. This can be done both with a general penalty description — "six figures,"
"high six figures," etc. — and with a characterization of the reasons justifying the
penalty amount — long standing, deliberate, calculated refusal to comply," "good faith
efforts to overcome technological difficulties," "significant health hazard," etc.
Inexperienced EPA negotiators sometimes appear reluctant to initiate discussion of
penalties or to demand high penalty amounts or to refer to penalty demands at the outset
of discussion, as if there were something unseemly about them or only Headquarters
cared about penalties. As illustrated in the example above, this creates an expectation
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that penalties are not seriously sought or that penalties in insignificant amounts will be
-accepted, particularly if the parties reach agreement on all other issues. Later
insistence on penalties in significant amounts will catch the opponent completely
unprepared. Indeed, the other side's negotiating team probably will have told its vertical
hierarchy that penalties aren't a big issue. To reverse itself now will result in loss of its
credibility with its vertical hierarchy.
Of course penalties are not the only issue on which expectations may or should be
managed. The techniques for managing1 expectations' are similar whatever the issue
involved. Such techniques, however, must be devised for the negotiation at hand. While
sending the other side a copy of a relevant policy may be helpful in lowering expectations
in one case, it may raise expectations in another case by alerting the other side to loop-
holes in the policy or to its inherent weakness.
- Managing Concessions. There are a number of other management techniques that
can be used to strengthen a negotiator's bargaining position. They begin with
inventorying the concessions that the team can make and carefully managing when and
how they are used. In general, a concession should only be made when something is
gained in return. Trades don't necessarily have to be of equal value — indeed the values
of concessions are often difficult to determine and of different values to the giver and
receiver. The value of a concession can often be enhanced by withholding it. When the
opponent seeks a concession that is of no great value to your team, don't automatically
give it away, you donft know how much it is worth to the other side. The more and longer
they press for it, the more value it assumes in their minds. At some point they may be
willing to make a valuable concession in return for it. Because of its variety of authori-
ties under many statutes, EPA can invent such concessions where they dont really
exist: "We will agree not to commence contractor debarment proceedings if you ..—
where there was really no intent on CPA's part to initiate such proceedings.
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When-approaching a concession, compromise or bargain, don't get yourself
committed until you're sure you are getting what you want out of it. Using questions
rather than statements is of great value in this regard: 'If I do X, will you do Y?" rather
than TU do X if you do Y." The question is as effective in exploring a possible trade but
is much less committal.
Of course, there may be times when effective management of concessiore will
prompt making a seemingly gratuitous concession. This often happets toward the
beginning of the bargaining phase of a negotiation. It may signal the team's willingness
to bargain or be flexible. It may establish good will. But even in these situations
concessions must be considered and managed. Is a concession likely to produce the
desired results? Is it the least concession that can be made to produce the result? Is the
result worth the concession?
4. Managing Public Pronouncements. An important aspect of managing both
the vertical hierarchy and other players is managing their public pronouncements. Just
as their communications with the other side can be useful or harmful, depending upon
how they are managed, so too can their communications to the media. Unfortunately,
their statements to the media cannot always be as well managed because of the fondness
of some in the vertical hierarchy for being quoted in the press and the skill of many
reporters for getting more information in an interview than is intended to be given.
There should be only one public spokesperson for a negotiation and all inquiries
must be routed to that spokesperson. If it is not the team leader, a person in the press
office who has been trained in the sensitivity of enforcement matters is often the next
best choice. There must be agreement on what can and cannot be said. Often care mist
be taken not to give the other side information publicly that it has not been able to get in
negotiations. One of the authors recently returned from a negotiating session with EPA
wondering what his client would have to give in order to get an extension of time on a
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compliance schedule that his clfent viewed as impossible. Before he formulated an
appropriate concession* he read in the next day's paper the admission of an unnamed EPA
official that the schedule was infeasible and would be extended.
There are other pitfalls to avoid. Chief among them is not to "grandstand" or to
paint yourself into a corner by promising the public a certain result at the outset of
negotiations, increasing the difficulty of adjusting that position as a result of the
negotiations.
Public statements by other government agencies are much harder to control than
statements by your own agency. If this is a problem, it is good cause to cut off
communications with the loose tongued agency.
n. EFFECTIVE COMMUNICATIONS
What is the most important tool of the negotiator? Verbal communication.
Managing expectations, creating doubts, educating, persuading, trading proposals and
coming to agreement are all done with communications, primarily verbal. The grim
faced, steely eyed, clenched jawed pose may be effective in expressing disinterest in
negotiation, hostility toward the other side, or rejection of a proposal. But it will not go
far toward bringing the other side to your point of view. You have to talk and talk
effectively to do that. Vocalized wor
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cooperative wimp who concedes every point. At the other is the obnoxious gunslinger
who no one trusts and most people avoid. Mog* of us, hopefully, are somewhere between
the two.
A study of effectiveness in attorneys' negotiating styles was conducted in
Phoenix. Attorneys were asked to rank the degree of success achieved by the opposing
attorney in their latest negotiation. They also ranked their opponents in over 100
characteristics which enabled the researchers to place them on the spectrum of
negotiating styles, from cooperative to aggressive. Sixty five percent of the negotiators
were rated as cooperative, of which 58% were ranked as effective by their opponents.
Only 25% were rated as aggressive, of which only 25% were ranked as effective. Thus,
while cooperativeness is no guarantee of success, it may be easier to be successful in a
cooperative mode than in an aggressive mode. At the same time, when the aggressive
attorneys were successful, they often achieved better results for their clients than did
their success' il cooperative colleagues.
Honest and trustworthy behavior were found to be a primary characteristics of
successful negotiators of both styles. Therefore, it is probably most effective to be
yourself when negotiating, but to maximize and capitalize on the strengths of your own
personality. For some, the bom hams among us, it may be natural to take on different
roles and styles in adopting to different situations. A cooperative approach may be more
effective when difficult technical issues must be understood and evaluated. A more
aggressive approach may produce larger penalties in enforcement negotiations. Changing
styles can even be effective during the course of one negotiation. When the mild
mannered, polite and rational negotiator suddenly reaches the end of his tether and
explodes, people tend to take him seriously.
B. Effective Listening.
Why should the negotiator worry about listening? Because the negotiation process
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is conducted by communication and communication requires listening as well as speaking,
a receptor as well as a projector. Two sides speaking at the same time do not
communicate with each other.
But the effective listener has a great negotiating advantage over a negotiator
without developed listening skills. The effective listener takes in not only what is said,
but what isn't said, the inflection, the body language, the message between the lines, the
unstated assumptions, the perceptions, the misperceptions, the evidently missing facts.
Effective listening captures"the words spoken and the thinking behind the thoughts
conveyed. This enables you to determine the weak points and blind spots in the other
side's case, the points where doubts may be most easily created:
Another advantage of the effective listener is that a good listener, just by listening
attentively and with empathy, encourage others to talk. The more the other side talks,
the more you learn about it and its case.
- Listening Tips. There are many techniques for improving team and individual
listening skills.
o Ask only open-ended questions that can't be answered with a yes or a no.
Discipline yourself to begin yow questions with "who," "what," "where," "when,", and
"how." The answers almost always tell you more than a one word reply.
o Exhibit empathy for the other side. Empathy prompts people to talk. more,
o Paraphrase what the other side says. Paraphase it twice. If you don't understand
it the way they do, they will say so.
o Summarise at the end of the session and ask if there are any issues not included
in your summary. Like paraphrasing, summarizing surfaces different perceptions from
the other side and avoicfe unnecessary misunderstandings. Asking whether all of the
issues have been addressed makes it harder for the other side to put new issues on the
table at the eleventh hour.
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o Appoint a listener/note taker, whose only job is as an observer. Over time the
listener will observe more about the reactions of the other side than anyone on your
team. The listener will know from the glazed or attentive looks in the eyes of the other
side which of your arguments or approaches are discounted or treated seriously, as well
as pick up the nuances of the other side's presentation. The very activity of notetaking
enhances the listening effectiveness of the note taker. (The note taker can have other
uses. If the team leader calls on the note taker occasionally to look to his or her notes
and read exactly what was said at some juncture, unless challenged, the note taker
becomes the unofficial historian of the sessions. This can be a critical source of power
when questions arise on past agreements. The team leader can also defuse outbursts by
asking the other side to slow down or repeat their words so the note taker can keep up.)
C. Effective Persuasion.
On issue after issue the other side must be made to doubt the viability of its
position and recognize the viability of your position. Argument, questioning and
presentation of facts are all used for these purposes. Inexperienced negotiators don't
recognize this and too often relapse into making speeches. Indeed, speeches are the
normal opener for the first negotiating session, when each team leader builfe a
persuasive case for the moral rectitude of his team's position, more for the consumption
of his own team than to seriously influence the other side.
- Argument and Questions. Argument is familiar to all of us and is taught to
attorneys. Argument without a good factual basis is usually self-defeating, being viewed
as mere sophistry. Even good argument, supported by fact, is often not as effective as
questioning. In an argument you may be trying to cause the other side to doubt its
position on an issue: "You can't tell me it costs $25,000 to install a monitoring well. It
only costs $10,000. That's what it coat at the XYZ plant next door." But this argument
is coming from you, the opposition, and may be rejected for that reason and to provoke a
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counterargument. The same point can be made through questions. "Would it cost much
more to install monitoring wells here than at the XY7 plant next door?" Probably not.
"Do you know what it cost there?" So. "I think it only cost $ 10,000. Why not call its
plant manager and check?" Using questions develops your argument in the minds of the
other side's team members, just where you want the thoughts to grow. It's the Socratic
technique used by law professors during the first year of law school — a powerful
educational technique when divorced from ego-deflating put downs.
- Facts. Facts are crucial in most environmental disputes. Facts determine which
regulation applies and how it applies. They determine whether a site becomes a
CERCLA site and how it is to be remedied. Presentation of facts play important roles in
persuasion. Effective presentation of facts can be of great value* especially in compli-
cated matters. Pictures, charts, maps, graphs, schematics help visualize the meaning of
factual data — or visualize a meaning consistent with your arguments and positions.
They are essential where the alternative is a morass of data which otherwise lacks
cohesion.
- Unchallenged Assumptions and Assertions. Facts are often asserted at a
negotiation session without verification. Nonetheless they are usually accepted as
facts. This suggests a number of conclusions. Assertions which are not rebutted or
questioned may become treated as facts by the negotiators. Similarly, assumptions
which are asserted but not challenged become facts. Recognizing this gives the
negotiator a number of advantages. The negotiator can establish critical facts merely by
making and repeating assertions. The negotiator then also recognizes the importance of
questioning the other side's assertions on critical issues before they become accepted
facts. Finally, the negotiator should not make assertions that he or she cannot back up.
If the negotiator is called on an assertion that carft be verified or is wrong, the
negotiator's credibility and trustworthiness is greatly diminished.
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These points are illustrated in a recent negotiation with EPA on an enforcement
matter. At a preparation session it was anticipated that EPA would want a client of one
of the authors to operate with one rather than two machines for interim emission
reductions until final compliance was achieved. The client would lose money under those
circumstances and simply shut down the whole operation. But for a variety of legitimate
reasons the client did not wish to lay out its economics before EPA. The client was very
worried about how to address the issue. The author told the client not to worry: the
assertion that the operation was not viable on one machine, when repeated, would
become an established fact. The client did not believe it. In the first negotiating session
the assertion was made twice, was accepted, and thereafter was treated as a fact. The
client was surprised. The author would not have made the assertion or advised the client
to make it, however, unless it were true because of the importance of maintaining
continued credibility in that negotiation and other negotiations for other clients.
m. CHANGING POLICIES AND FACES
Continuity is critically important in negotiations. Lack of continuity has adverse
consequences ranging from loss of the efficiency in the internal functioning of the
negotiating team to loss of trust between teams. The first can impair the performance
of the team and the results it achieves, the latter can jeopardize the ability to reach a
settlement. Lack of continuity of attorneys contributed to EPA*s woes in the Case of the
Unmanaged Negotiation.
Although continuity can be broken by changes in many factors — people, policy,
statute, regulation, number or identity of parties — in EPA probably the most common
are changes in people and policy. People changes can occur at many levels — on the
team, in the vertical hierarchy, in outside groups which have an interest in or an effect
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on the outcome of a settlement. Changes at any of these levels may have an adverse
effect on a negotiation. In EPA, probably the most common is a change of team
members.
A. The Problem.
Changing team members and policies are a particular problem for EPA
negotiators. Their incidence differs from office to office and program to program. They
tend to be greatest in programs and offices that are undergoing rapid changes for such
diverse reasons as statutory amendment* staff increase or decrease, and shift in
regulatory philosophy or approach. They caiae the regulatory community great
frustration. For instance, a group of PRPs (parties who are potentially liable to perform
or pay for the remedial action) negotiating a remedial plan with EPA will experience a
variety of difficulties when faced with a series of three on-scene-coordinatora during an
eighteen month negotiation. Each on-scene-coordinator will require time and attention
to become familiar enough with the site to deal with its remediation. Each is apt to
come to the problem with somewhat different assumptions, remedial preferences and
information needs. The resulting protracted dispute over remedial methods and
increased expense of new or repeated information gathering may cause the PRPs to
believe EPA is less than zealous in Its desire to remedy problems at the site and is
indifferent to the increased expenses incurred by those PRPs. This, in turn, will make
the PRPs less willing to deal with EPA and therefore harder for EPA to deal with
effectively. And from the perspective of the public and the environment, delays in site
cleanup may proliferate, both from the personnel changes and from their adverse impact
on the course of the negotiations.
The greater the changes and the later they occur in the negotiation process, the
more disruptive they will be. When a settlement has almost been reached on removal to
a specially constructed landfill, the settlement is apt to break down if there is a last
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minute policy change requiring that landfill cleanups be accompanied by a bond to
guarantee perpetual care or a last minute substitution of a new on-scene-coordinator who
insists on fundamental landfill design alterations. Either could completely alter the
PRPs' assumptions regarding the cost of the remedy and its desirability relative to other
remedies. Either could cause them to question whether EPA was operating in good faith,
had any idea what it wanted, or could finally agree to anything.
While EPA may be particularly prone to these problems, EPA negotiators should
understand that EPA is not atone in having such problems and that EPA negotiators can,
through proper management, sometimes avoid and often ameliorate the problems caused
by such disruptions.
Changing faces are not unique to EPA or the government. Indeed, in much of the
government and in many parts of EPA, continuity of personnel is remarkable. But
changing faces are a natural phenomenon of large organizations. Changing EPA faces at
the negotiating table are especially apt to occur when there are changes in EPA's
leadership, changes in the size of a program's staff, or emphasis on a program which
results in personnel attrition to state or private sector employment. These same forces,
plus others, also act on other large organizations. The presidency of one hazardous waste
management company changed three times in as many years, each change bringing about
its own brand of reorganization. EPA negotiators should not be misled into thinking they
are the only ones whose negotiating teams and vertical hierarchies are too often beset
with changing faces.
B. What Can You Do?
EPA negotiators can manage changing faces and policies, or at least manage
the effects of the changes on the negotiation process, if they recognize that such
changes can jeopardize the negotiation process and that the negotiators are responsible
for such management. Care in selecting team members may often avoid the changing
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face problem. The team leader should make sure his or her team members are there for
the duration. If a member is to be transferred to another position, the team leader
should negotiate with the vertical hierarchy for the new job's assignments to include
completion of the negotiation or the assignment of another team member for whom
continuity is no problem. If a change in team members is unavoidable, the team at the
very least can assure that the outgoing team member thoroughly briefs the new team
member so that he or she stancfe in the shoes of the departing member. And the team
can get the agreement of the new team member to accept and act consistently with what
the team has done to date to avoid replowing the same ground two or three times.
The effects of policy changes can be blunted if the potential for change is spotted
early enough. Perhaps the change can be delayed for a short period to accommodate a
settlement (which gives the EPA negotiating team a lever for quick settlement). Perhaps
the policy change can be worded so as not to apply to negotiations in process. At the
very least the EPA negotiators should know of impending policy changes and keep the
other side informed of their timing and likely impact. This should speed the pace of
negotiations and avoid embarrassment if a settlement must be restructured to avoid an
eleventh hour change in policy.
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0
v
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NEGOTIATION P ilNG/MANAGEMENT MODEL
(Order of Consideration*
1st 2nd
6th
7th
5th
4th
3rd
Interests/Tssues
Ours | Mutual | Theirs
Bargaining Positions
Initial
FallbacMs)
Decision
Tr igger
Point
Points
Bottom
Line
Consequences
of Impasse
I
I
I I
-Use as criteria for setting
bargaining positions
-Use as basis for persuasion
of opposition regarding
posi t ions
-Include risks to be avoided
-Use mutual interests/issues/
risks to provide easy agree-
ment points
-Obtain information bv asking
"why?'
-Use to
educate
opponent of
your inter-
ests and
issues
-Use to
create "Yes'
habit in
opponent
-Set at
highest
justifiable
position
-Use to
educate
opponent on
how you will
negotiate
-Formulate to
address
opponents
interests &
issues
0 Set "Yesable" positions
° Each position should be
a total settlement
package
0 Each position should be
justifiable seperately
° Preset trigger event/
point for shift to next
posit ion
1
-Point at
which it is
obvious that
Bottom Line
unattainable
-Point for
reevaluat ion
of entire
negot iat ion
strategy
-Set at
percentage
short of
Bottom Line
and comple-
tion date
-Point below
which your
interest is
jeopardized
-Point for
terminat ion
of negotia-
tion
-Set at
lowest
acceptable
position
-Set time
deadline to
complete
negot iat ion
-Describe as
worst case
scenario
-Determine
from both
Agency and
personal
perspective
I
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NEGOTIATION PLANNING/MANAGEMENT MODEL
(Order of consideration)
1st 2nd
6th
7th
5th
4th
3rd
Interests/Issues
Ours I Mutual I Theirs
Barqaining Positions
Initial | Fallback(s)
Decision Points
Trigqer Bottom
Point Line
Consequences
of Impasse
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Pointers for the Conduct of a Negotiation
a. DO's
1. When trust raised, negate it as an element of an
aareement
(a) Can build credibility, thouah
(b) Can be built in an extended negotiation.
?. Open ud your and the other side's interests by asking
why you want something. Then, explore other approaches
to meeting such "opened-up" aims.
3. Use lists, maps and other physical demonstrations.
4. Record aareements
^. «ATNAs: When it's better than they think, reveal it.
When it's worse, don't.
fi. Check your perceptions of the facts with the other side
by ouestionina them. If you hear something discordant,
take a break and re-evaluate your power in the negotiation.
i. Look toward the positive. Pick up on other side's more
promising ideas rather than rebut the less promising ones.
8. Ouestion deadlines
9. Restatements
fa) Restate the other side's position to check
vour understanding.
(b) Have them do so with vour positions.
10. Must have a pre-agreement with your vertical hierarchy.
Further, you must keep information flowing to the vertical
hierarchy, and involve them in the process. This makes your
hierarchy part of your team, arguring for the settlement
you produce.
11. Focus on deadlines. Can get better terms if you know
the other side's deadlines.
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-2-
12. If you have something to give the other side, even
thouah minor, you should withhold it for a while. The
withholding of it will make it increase in value even
if the other side also views it as minor. They will
beain thinking it has more value because you won't
oive' it uo.
13. important to find a common qoal that both sides can
aoree on, and to do so at the beginning of the
neaotiation.
Don'ts
1. Don'ts aet intimidated.
7. Don't start to give in too easily as agreement monmentum
builds. Take breaks to review goals/interests.
3. Never surprise the other side.
4. Never assume the other side sees the issues as you do.
Counter-points to "hard bargaining'' or tricky tactics:
1. Slow down to avoid a too speedy closure
2. ignore provocation
3. Humor
A. Keep returning to substance
5. Use silence, even long periods, and return to topic
6. Take breaks
7. Physically move next to the person
8. Switch points
9. Address the issue or tactic
10. Physically move back
11. Be nice
12. Let them blow off steam
13. Agree if their anger is justified
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-3-
14. Break off and tell them to call you when they
want to continue
15. Don't counterattack when they attack
1«. Don't resist criticism: invite it. Ask for their
advice.
17. Recast personal attack as one on the problems
18. Use Questions not statements
19. Tell them vou're trying, to act reasonably
20. use warnings, not threats
21. Refuse to respond to threats and state you only
negotiate on the merits
22. Insist on principled justification of their position
2?. Creatino a fadina opportunity for an agreement
24. Look for face savers for the other side
o. Successful negotiators tend to:
1. Avoid things which irritate the other side
2. Avoid counter-proposals
3. Avoid getting into the attack-defend spiral
4. Forbear argument dilution. Give 1 or 2 strong
reasons rather than many weak ones.
5. Label contributions
6. Start with reasons for disagreeing and then disagree,
not vice versa.
7. Check for understanding and summarize frequently
8. Constantly seek more information that what's provided.
9. Say how they're thinking or feeling. Give process
information.
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-4-
"Presentlv Perceived Choice". What chance does your
proposal have in liqht of their present thinking.
1. What do you need to chanae to get them to say yes:
(a) Rephrase proposal
(b) Propose it to someone else
(c) See if you can make their negative reactions less so
(d) See if you can make positive reaction more attractive
(e) If they can say no now, construct a fading opportunity
(f) Your openina position should be low enough to protect
yourself, but hioh enouqh to be taken seriously
2. Perceptions are important, not facts
3. Important to sell the other side throuoh their styles
of viewino the world. Formulate your arguments and
statements to conform to their ways of thinking.
Best neaotiators are qood listeners, not talkers.
Listening tips:
1. Ask onlv open-ended auestions
2. Display attentive behavior
3. Frnpathize
4. Paraphrase to communicate your understanding
of the other side's statements
G. General
1. Nothina in a neqotiation is "their problem;" everything
is "our problem" because if you don't help them solve
it they won't help you.
2. Patience is verv important. That the other side stays
at the table shows their commitment to settlement.
3. Mav want to let the other side walk out. To return, at
a minimum, they have to aive up some leverage.
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a. You can make proposals, even bottom-line ones, in
hypothetical terms ("what if...").
5. Your iob as a negotiator is to manaae expectations.
Lower those of others so your proposal can be accepted.
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ADR PRESENTATION
I. Purposes of session
A. Discuss use of third-party neutrals in enforcement and
defense actions
B. Expand negotiation concepts already discussed in this
course
II. Use of neutrals
A. Definition .of. ADR: Use of means.other than traditional
litigation to resolve disputes. Term generally
excludes negotiation, too.
B. Types of ADR identified as potentially useful in EPA
litigation matters
1. Mediation: use of a neutral with no decisionmaking
authority to aid the parties in their
negotiations. This method is nohbinding.
2. Arbitration: Contrast with mediation although it
can be binding or advisory. A judicial-type
setting where the parties choose the arbitrator
for his/her expertise in the subject matter.
Arbitrations are more streamlined in terms of
procedures and evidence requirements than court.
3. Fact-finding: Can be done either in an
investigatory or arbitration format. Can also be
binding or advisory as with arbitration.
4. Minitrial: Parties* attorneys put on abbreviated
versions of their cases in front of decisionmakers
for each side (corporate executive or Regional
manager) and a neutral referee (optional). Then,
decisionmakers retire to negotiate the case.
5. Settlement Judge: Use of a judge other than the
one hearing the case to give his/her opinion as to
the probable outcome of the case, after which the
parties negotiate in light of this new
information.
B. Why use ADR? To deal with negotiation and litigation
traps identified by EPA negotiators such as:
1. Personality problems among negotiators
2. Unwieldy numbers of plaintiffs and defendants
with different agendas
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3. Inflexible negotiating postures
4. Sophisticated technical circumstances leading to
a myriad of disputes over facts
5. Routine cases taking an inappropriate level of
resources
III. Statistics on ADR usage
A. Over 200 jurisdictions have court-annexed programs
B. Survey taken of Fortune 1,000 companies shows
tremendous growth in the corporate sector
1. ADR uses 3% of litigation resources
2. Success rate between 85%-95%
IV. The project
A. EPA policy to use ADR in appropriate enforcement and
defense matters
B. Support from the Administrator and OECM
C. Brief description of the Guidance (8/14/87)
1. Administrator's request for case nominations
2. Describes relevant ADR mechanisms
3. Proposes criteria for case selection
4. Sample nomination and approval procedures
5. How to find and qualify neutrals (Administrative
Conference and EPA working on a computerized
service to provide names of mediators, which
should be available this summer)
D. Important points to remember regarding the
appropriateness of ADR in a particular case
1. Not for all cases; for a distinct minority
2. A case management tool - extensions of negotiation
and litigation processes
3. Use deadlines and litigation with ADR as with
negotiation
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4. No loss of control. Parties decide the procedures
and substance to be covered.
5. Not designed to force concessions from EPA
6. Useful for parts of cases, not just the whole
matter
7. Useful in the dispute resolution section of
consent decrees for future disputes (examples in
TSCA, RCRA AND CERCLA cases)
8. Every case gets heard (day in court)
9. Where appropriate, can get executives involved
early
10. Possibility of a win/win result
11. Avoids having to educate a judge who may not be
interested, and eliminates the fear the judge will
not understand and run amok
12. Benefits even where there is no resolution
a. Facilitates litigation to look at the big
picture
b. Work done is usable later
c. Can score points with the judge if the other
side turns it down
13. Helps guard against after-the-fact criticism,
giving you ammunition for second guessers
14. Offers confidentiality
15. Salvages continuing relationships
16. Rather than giving a perception of weakness to
suggest ADR, the Fortune 1,000 survey shows it
communicates strength and rationality
E. Services OECM offers in this area
1. Help sift through caseload/discuss specific cases
2. Prepare nomination and see it through
3. Discuss process with the litigation team and the
other side
4. Locate neutrals and pay government's share
5. Draft ADR agreement between the parties
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6. Provide advice/help during the process
7. stay out of the substance of the case
Regional pilot programs: Regions III and V (Superfund
small cost recoveries)
Places to look for potential ADR nominations (kinds of
cases)
1. Any cases not moving toward resolution at pace
desired
2. Cases over a certain age such as two years
3. Administrative and judicial actions
4. Cases at any stage, including pre-litigation (the
earlier the better)
5. Defensive and enforcement cases
6. Federal facilities
7. Superfund: Small cost recoveries (Region V doing
this)
Case experiences to date
1. Sheridan case where mediation used to solve 10-
year drinking water problem in Wyoming
2. 10 nominations: 2 air cases, 4 water cases, 2 RCRA
cases, 1 drinking water case, 1 TSCA case and 1
Superfund case.
3. Used in 5 consent decrees as well for future
disputes: 2 Superfund, l RCRA and 2 TSCA
Contact Rich Robinson for more information (FTS: 475-
8293)
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CONTRACTOR LISTING FACT SHEET
The Envronmental Protection Agency is placing a new
emphasis on using its "listing" sanction to obtain compliance
with the Clean Hater Act (CWA) and the Clean Air Act (CAA).'
CWA S 508 and CAA S 306 provide EPA with the authority to place
on a List of Violating Facilities (List) those facilities which
are not in compliance with the CAA or the CWA. Facilities on the
List are precluded from receiving government contracts, grants
or loans, including subcontracts, subgrants and subloans. The
listing action applies to the specific facility involved in a
particular violation.
Facilities are added to the List in one of two ways:
automatically as a result of certain criminal violations of the
CWA and CAA (mandatory listing); or at the discretion of the
Assistant Administrator for Enforcement and compliance Monitoring,
after an administrative process to determine whether the facility
has continuing or recurring violations (discretionary listing).
Certain epa officials, state governors, or members of the public
may make recommendations to the Listing Official for facilities
that epa should consider placing on the List.
The List is distributed throughout the federal government
to ensure that no facilities on the List receive federal con-
tracts, grants or loans or other forms of federal assistance.
When applying for federally funded contracts, grants or loans,
companies are required to certify to that they are not on the
List, and are not using any listed subcontractors. Listing is
designed to protect the federal government from awarding contracts
to those facilities that are not in compliance with environmental
laws and to prevent noncomplying facilities from obtaining
a competitive advantage by avoiding environmental compliance
costs.
Facilities which are listed may be removed from the List
if the Assistant Administrator certifies that the facility has
corrected the condition that gave rise to the violation. They
may also be de-listed if a court has overturned the conviction
which was the basis of the mandatory listing. Facilities
listed under discretionary listing remain on the list for one
year, or until they have corrected the noncompliance, whichever
comes first. At the end of the year EPA say reinstate the
listing for new or continuing violations.
H-6
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In October 1987 the Office of Enforcement and Compliance
Monitoring (OECM) issued the Contractor Listing Protocols,
which give a detailed discription of the procedures which the
Listing Official follows in processing mandatory and discre-
tionary listing actions. They also describe the essential
roles of EPA staff in the Regions and at Headquarters in
carrying out. the listing, program—
On March 11, 1988, OECM Issued guidance for listing as-
bestos demolition and renovation companies which are violating
the asbestos NESHAP. These companies will be specially target-
ted this year.
There are now 10 facilities on the List of Violating
Facilities and numerous cases under consideration for listing.
Jonathan S. Cole Tracy A GipSOn
Chief Listing Official Listing Official
(202) 260-8776 (202) 260-8780
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