Content

Mazen Qubty

In the following, three cases of conflicts within organizations will be presented. From these cases we will be introduced to certain patterns of conflict resolution.

The cases are the following three major work crises that occurred in East Jerusalem:

• the American Colony Hotel in 1993;
• the Seven Arches Hotel in 1995-1996; and
• the Augusta Victoria Hospital in 1997.

I chose these three cases for several reasons. For one thing, the ownership is different: that of the American Colony is Swiss, that of the Seven Arches Israeli, and the Augusta Victoria Hospital is owned by the Lutheran Federation. You will see that the different ownership of these three institutes influenced the process of the negotiations and the process of solving the crises. All of these institutes have Palestinian staff, mostly from Israel and some from the West Bank. Another important thing to notice when we discuss the cases of the American Colony and the Seven Arches is that they are commercial services, while the Augusta Victoria mainly offers services for Palestinian refugees and poor people, and acts more like a charity institution rather than a commercial one. This was undoubtedly another factor that influenced the negotiations.

u The American Colony Hotel

For a long time many of the major institutes in East Jerusalem refused to apply the standards of Israeli Labor Law. As a result, many employees did not enjoy the same rights as other employees who worked in West Jerusalem. More and more employees began fighting to obtain these rights. This problem first evolved in the institutes whose owners were not Palestinian. The conflict was not between Palestinians therefore, but between Palestinians and non-Palestinians on the applicability of the Israeli Labor Law inside these institutes.

The American Colony Hotel was considered the most profitable hotel in Jerusalem, and the fact that it was very prosperous meant that the management could not claim that there was no profit due to lack of work. This matter led five of the employees who were fired by their employer to approach me as a lawyer. They asked me to represent them against the management of the hotel. While they were working in the hotel they had never approached the management and claimed their right to be treated according to the Israeli Labor Law. Frankly, when the crises started we did not believe that the case would become as large as it later did. We thought we would be dealing only with these five employees who were fired.

We decided to go to the Israeli court, looking for either a settlement or a court decision to end the conflict. Before going to court we had to decide upon our strategy and our desired outcome, and we had to recognize the tools we had in hand. These are very important factors in any case. First of all, it was clear to us what the employees wanted. They did not want to come back to work. They wanted the rights to which they were entitled under Israeli law. To open the case we had to go to court. Before we went to court, however, we established our limits for both the optimal case of 100-percent success and the minimum that would be acceptable.

We also needed facts. The employees did not have many papers with them when they approached me. I told them to keep quiet at the current time and to try to get as many papers from the hotel as possible through the current employees there. Through this method we were able to obtain photocopies of the weekly programs of the employees for the past seven years. As a result, we knew how much each person worked and when. This enabled us to prepare our suits and to determine the rights that we would be able to obtain in this case through the suits or through negotiation.

We were very surprised by the response of the American Colony. I believe that their response was influenced by several factors. After we initiated our suit against the American Colony, they asked us to sit with them and negotiate with the five employees. We started talking to them, and after a few sessions they realized that were the case to continue we would win it. They asked us to give them a two-month period to think about the issue and to discuss it with their board of directors, to which we agreed.

Two months later they came back to us with a very interesting proposal, asking me to represent all the employees of the American Colony. They based this proposal on the fact that all other employees would be able to make the same claim as the five former employees. I suggested that they first deal with the five employees separately to establish criteria for a collective settlement, to which they agreed. Accordingly, we gathered all the employees and explained that the management would soon be forced to pay reparations for failing to uphold the rights of their employees over the past seven years, and that they had the freedom to choose their lawyer. Thus the small problem of the five employees became the problem of all employees of the American Colony, including others who had worked for the hotel in the past seven years and had been fired.

We began discussing ways to solve the problem. The employees’ interests involved obtaining as much money as possible, for after reaching an agreement they could not again extract compensation from the management. The management, of course, wanted to pay these workers as little as possible, but at the same time knew that if all the employees went to court individually their cost would be two or three times as great. This stage of the negotiation lasted two months, after which the employees were awarded one million US$. This amount was to be divided among all the employees according to their position and years of employment. At the conclusion of the negotiation, each employee signed an agreement with the hotel specifying the amount of money to which he was entitled and the labor rights that would govern the terms of their employment in the future.

This conflict was unique in that the management expressed considerable good will. They not only desired to preserve their reputation and good business relations, but also recognized that the hotel would be best run if the employees were content and their rights respected.

u The Augusta Victoria Hospital

This conflict presents a different way of resolving organizational conflicts, and was influenced by the nature of the organization in question. As mentioned previously, this hospital offered medical services to refugees and poor people. Most of its money came from various international organizations, with only a minimal amount collected from patients in return for medical services.

The Augusta Victoria conflict began when the Israeli authorities applied their medical insurance policy to East Jerusalem. According to this law, any person living in East Jerusalem is entitled to medical insurance, can become a member of any of the different ‘Kopat Holim’ patient trusts, and can go to Hadassah or Sha’arei Zedek or any other hospital in Israel without paying money. As a result, Augusta Victoria realized that many of its clients, mostly from East Jerusalem, would no longer come to them for health care as the quality of health services provided by the Augusta Victoria was not as high as that of Hadassah or Sha’rei Zedek. Augusta Victoria initiated a change in the hospital’s policy, converting it into a specialized hospital that provided its services to Kopat Holim medical centers so that the latter would send its patients to Augusta Victoria. This process of transforming Augusta Victoria from a charitable organization to a commercial hospital created a conflict, for the organization did not effect a corresponding shift in the treatment of its employees.

Many of the employees of Augusta Victoria approached us to represent them against the management of the hospital. Again, they were asking to be granted rights according to the Israeli Law applicable in East Jerusalem. We new that dealing with the Augusta Victoria would not be as easy as with the American Colony, for the Augusta Victoria played a very large role in providing health care to the Palestinian community. It was one of the very few hospitals in Jerusalem that played a role in the Intifada, and therefore was of particular political significance.

Although we at first thought that the conflict would only involve the employees and the Lutheran Federation, the Palestinian Labor Union and the Palestinian leadership in Jerusalem also became involved. The new players had an important role for they took the side of Augusta Victoria, trying to convince the employees that they had no right to fight this institution. In the end, their efforts succeeded in dividing the employees to three groups. One group abandoned the lawsuit and forfeited any claims to compensation. The second and largest group decided to settle for approximately 20 percent of the rights to which they might otherwise have been entitled. The third group decided to continue the fight against Augusta Victoria in the Israeli court. The verdict of this case has not yet been reached, but when it is the employees who held out will likely receive four or five times the compensation of those who agreed to settle early. The significance of this case, however, lies in the fact that it was governed not by purely legal factors, but also by outside interests and influence.

u The Seven Arches Hotel

This hotel used to be called the Intercontinental, and belonged to the Jordanian government. After the occupation of East Jerusalem in 1967, however, Israeli law considered the Jordanian government to be absent, and confiscated the property. A representative of the Israeli Ministry of Finance is running the hotel as a 'custodian' until an agreement officially decides the status of the property. During the period of the labor conflict, the ownership of the hotel was in the hands of the Israeli representative, and all the employees were Palestinians.

Although the management of this hotel was Israeli, they did not implement the Israeli labor laws. After hearing of the American Colony incident the employees of the Seven Arches approached me, saying that they wanted to file a similar suit against their employer. As in the previous case, documents were obtained by current employees and a letter was sent to the management stating our intentions.

After one month, in July of 1995, the hotel employees were suddenly granted their rights according to the law. The question remained, however, of the past seven years of disregard, and we continued to pursue the case. The management claimed, however, that seven years prior the employees had not been productive, and that the management had granted them a favor by not firing them. They presented many such excuses in an attempt to avoid paying back reparations, and decided to go to court. Labor court cases are not settled in a matter of months, but instead take between three and five years to resolve. The hotel management played upon the fact that most of the employees were not willing to wait this long, and even exacerbated this obstacle by stalling as much as possible, making many requests to the court. The struggle became one over the duration of the case, which the employees wanted to minimize and the management wanted to maximize. The management's strategy worked, for the employees soon agreed to negotiate a settlement for less than 100 percent of their entitlement.

The management then claimed that the case could not be settled through a court at all, but instead had to be brought to the Histadrut, the Israeli labor union. According to the collective agreement applicable to this hotel, only representatives of the Histadrut and representatives from the Hotels Owners Association could be mediators in this conflict, and only if they fail to mediate or reach a solution can the conflict be taken to court. The employees agreed to these terms, so representatives from the Histadrut and the Association held several sessions in which each party tried to convince the mediators to uphold its viewpoint. The result of this mediation granted the employees only 50-60 percent of their rights. Some of the employees agreed to end the problem at this stage, although my personal preference was to continue to fight. We knew that one of the mediators had met with the management of the hotel separately and we used this fact to attack their decision in court, claiming that the mediator's decision was not valid. We knew that the court might not uphold such a claim, but we used it as a tool to pressure the other side and the mediators themselves to re-examine their decision and offer the employees more money. After two or three additional sessions we extracted another 20 percent of the employees' rights, bringing the total to 70-80 percent of that to which they were entitled over the past seven years.

In each of these three cases the mediator involved represented a different interest. There is no doubt that the Palestinian leadership in Jerusalem and the Palestinian Labor Union took the side of the Augusta Victoria and the Histadrut and the Hotel Association took the side of the Seven Arches for political reasons. In the American Colony case the interests were only commercial, and as a result it was the easiest conflict to resolve, yielding the best results.

All three cases involved the following four elements:

1. a situation of conflict;
2. negotiations;
3. different influences from different sides;
4. an agreement.