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What can Brexit teach us about Settlement Negotiations?

What can Brexit teach us about Settlement Negotiations?

We are now some five months into the UK’s Brexit negotiations with the EU, and even hard line Brexiteers would agree that things are proceeding…slowly. The parties are struggling to agree even on what to talk about, with the UK pressing the EU to move away from the specifics of the financial deal and onto the sunlit uplands of a potential trade deal. The post-summit updates provided by David Davis and Michel Barnier are mostly notable for their lack of news: nothing of substance seems to have been agreed yet. Obviously, the complexity and wider implications of Brexit far exceed even the most high value employment dispute, but there are parallels to be drawn between the Brexit process and settling employment disputes. For your benefit (and perhaps for Mr Davis and Mr Barnier) we set these out below:

1. Agreement requires compromise. Deals only get done if both sides are prepared to move from what they ideally want. Simply demanding what you want or creating too many ‘red line’ issues will limit the prospects of reaching agreement. Presenting an issue as a ‘deal breaker’ risks blowing your credibility if you later have to concede that it is not. You will not achieve a deal unless you can find a way for each side to feel that they have ‘won’ something from the negotiations.

2. Understand who has the bargaining power. If you are in a much stronger financial position and/or will be less affected by ongoing litigation (even if it ultimately ends in defeat), use your position to pressurise your opponent to accept less than they want. Equally, if you are in the weaker position, recognise this and don’t get too hung upon the merits of your position. Real difficulties can emerge in negotiation if (as is perhaps the case with Brexit) both parties believe they are in the stronger position.

3. Don’t overplay your hand. If you are likely to lose or you are weak in certain areas, unless you have dominant bargaining power (see 2 above) it is generally best to recognise this and settle early/concede some points. The longer a dispute goes on, parties become more entrenched, more time and money is wasted and it can be harder to reach agreement. Most settlement negotiations don’t have the equivalent of the two-year Article 50 ticking clock, but there is usually a deadline looming, and a sense of urgency can help both sides. Of course, you must present your position as forcefully as possible whilst negotiating, but your position must remain credible.