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Curb Your Enthusiasm: How Overconfidence Can Kill the Deal (And What To Do About It)

Posted: February 20th, 2020

You’ve just left the negotiation table, and you know it went well – it’s in the bag! Except it’s not, and later it turns out that the deal is dead. Confidence is a critical quality in strong negotiators, but too much can cloud your judgment. Consider the steps below to rein it in and ensure your confidence is an asset, not a liability.

Embrace the unknown. Sure, you’re a great negotiator, you did your research, and you’re feeling completely prepared for your negotiation. This may be true, but try thinking objectively – a smart negotiator accepts that uncertainty will always be a fundamental part of any negotiation. Acknowledge that no matter your skill, you can never perfectly predict an outcome. You’ll be more willing to propose (and accept) mutually beneficial compromises, and you’ll be a better negotiator for it.

Play devil’s advocate. Before a difficult negotiation, find someone whose opinion you trust (it doesn’t have to be a colleague) and get their opinion on your approach. When you’re in the thick of researching for an upcoming meeting, you might be in too deep to realize something obvious. An outside observer could provide some critical advice, and maybe deflate your ego a bit (all in the interest of personal growth, of course).

Accept your faults. A healthy amount of humility would do us all some good. Before any negotiation, be sure to look not only for things that can work to your advantage; take the time to look into factors that could work against you and use it as an opportunity to come up with solutions. Do you have a tendency to talk over your opponent, causing them to get aggravated and raise their voice? Are you prone to stick too firmly to your convictions, bringing the meeting to a halt because no one will budge? Take a hard look at your negotiating tactics and prepare some resolutions before your next meeting. You may even find a way to work a fault to your advantage.

Confidence is the bread and butter of any negotiator – after all, how could you get anything done without it? None of us are perfect, however, and you’d be wise to use some of these techniques if you find that your deals keep hitting roadblocks. Confidence is only one of the tools in your arsenal, and you should hone it just as you would any other skill.

Renegotiating a Bad Deal

Posted: January 9th, 2020

By: Joe Campolo, Esq. email

Tags: negotiation

Ever negotiate a deal and happily put it to bed, only to have to revisit it months or years later? Every negotiator has ended up with an agreement that no longer suits their needs, or their adversary’s, and must go back to the table to turn the lopsided deal right again. But the dynamics of renegotiation aren’t the same as negotiating for the first time, and renegotiating what you thought was a done deal comes with its own set of pressures. Read on for tips on renegotiating effectively.

Identify the key issues: Are you the party initiating the renegotiation? Before approaching the other parties, make sure you have a clear idea of what is wrong with the current contract. Look at the role each party plays in causing the problem and how everyone, not just you, is affected by it. Then decide which issues are most important. You may not be able to resolve everything. Plan to address your biggest problem first. On the receiving end of a renegotiation request? Analyze and understand what’s critical to the other side, what points you can’t budge on, and where you may have some room to negotiate. Decide if it’s worth giving a little to avoid the deal falling apart – or if it isn’t.
Propose a renegotiation: If you’re the party seeking the renegotiation, once you’ve identified the issues, confront all parties involved and actually propose a renegotiation. Clearly articulate why you view components of the contract – or results that came out of the contract – as problems, and back that up with convincing evidence. Odds are that the opposing side will be willing to sit down and consider alternatives. Most people have a desire to be fair, especially if you’re able to back up your claims with evidence – and even if they’re not feeling charitable, they may choose renegotiation over an expensive lawsuit.
Understand the dynamics: Negotiations for new business deals are often positive, with the parties sharing an optimistic view of the deal’s potential. But renegotiation often takes place somewhere between dashed expectations and the threat – or actual filing – of a lawsuit. Understand that the same negotiation strategies you employed the first time around may not be the right choice now, and that you and your adversary know more about each other than before. This reality can be either a curse (you let your adversary exploit what they know to their own advantage) or a blessing (here’s an opportunity for you to use what you learned during the first go-round to get a more advantageous deal).
Create value: A gain for you doesn’t need to be a loss for them – it’s in your best interest to provide some benefit to the opposing party in your proposed resolution. You’ll accomplish nothing if you both enter the renegotiation unwilling to give an inch. Create an atmosphere of cooperation and see how you can come to at least a win-not-lose solution.
Take your time: With urgent problems, it’s common for negotiators to push for a quick fix to alleviate the stress. But the flawless plan you negotiate today may not work for you three years from now. (Isn’t that why you’re at the renegotiation table in the first place?) Take the time to consider negotiating shorter-term deals that will allow for natural breaks for renegotiation. Both parties can come back to the negotiation table and discuss what works for their businesses after the short contract concludes.

Whether you want to renegotiate because your original plan has unintended consequences, or you just want to see if you can get more out of your deal, keeping the above tips in mind will help your renegotiation plan succeed.

Winter Weather Policies for Employers

Posted: December 11th, 2019

By: Arthur Yermash, Esq. email

Tags: labor & employment

Slippery commutes, delayed deliveries, school closings, and a host of HR complications: a child’s winter wonderland can be an employer’s nightmare if you’re not prepared. With temperatures dropping and the risk of snowstorms looming, employers should take the opportunity to brush up on the employment laws relating to winter weather closures. Whether you plan to keep your office open, close early, or shut down on the next snowy day, read on for answers to some common issues employers face during winter storms.

Non-Exempt Employees

Your non-exempt employees should be paid only for hours they have worked; the Fair Labor Standards Act (FLSA) does not require employers to compensate non-exempt employees who cannot work due to inclement weather. This applies whether the employee decides to stay home or if the employer closes; in both cases, the employee must be paid only for the hours worked. Note, non-exempt employees must be paid for work completed remotely even if the employer did not give permission for the non-exempt employee to do so, so it’s critical to communicate your expectations ahead of time.

An exception to this rule is “Call-In Pay.” CRR-NY 142-2.3 states, “An employee who by request or permission of the employer reports for work on any day shall be paid for at least four hours, or the number of hours in the regularly scheduled shift, whichever is less, at the basic minimum hourly wage.” This would mean that an employee who is called into work and is sent home less than 4 hours after his/her arrival must be compensated for at least 4 hours at the basic minimum hourly wage.

There is also an exception for “on call” time; for example, if your office has lost power due to a storm and your employees are required wait and see if the power comes back on, non-exempt employees must be paid for the time spent waiting, regardless of their ability to be productive during that period.

Exempt Employees

Exempt employees must be paid their full salary if the office closes due to inclement weather for less than a week. Additionally, if the office closes early, exempt employees must be paid for the full day. If the office is open, however, and the exempt employee chooses to stay home due to snowy conditions, the employee must use paid time off. (Are you sure that your exempt employees are classified correctly? Read this article on the 2019 changes to overtime exempt salary threshold.)

Both exempt and non-exempt employees may be able to perform their jobs from home in cases of office closures, but employers may need to rely on self-reporting to monitor how much time was worked. To minimize issues that may arise, it’s important to share your expectations with your staff in advance of a storm. Do you expect them to work from home if the office is closed? Should they refrain from working at home? How should they track their time? These questions are best answered before the office closure.

Employers should be proactive about their inclement weather policy, put it in writing, and remind employees of the policy as storms approach. Communicate with your staff about how your leadership team determines and communicates office closures and whether employees are expected to work from home. If you have any questions regarding your inclement weather policy, please contact us.

The Difference Between Empathy and Sympathy in Negotiation (And Why It Matters)

Posted: November 25th, 2019

By: Joe Campolo, Esq. email

Tags: negotiation

The Chinese general and military strategist Sun Tzu famously wrote that the “supreme art of war is to subdue the enemy without fighting.” Using empathy at the negotiation table is the modern-day embodiment of this strategy.

A fundamental human need is to feel accepted, validated, and understood by others. This reality means that negotiation strategy is really about psychology. To get from Point A to Point B, the skilled negotiator must exploit psychological principles – and this means empathy must play a role.

Many negotiators view empathy and sympathy interchangeably, and dismiss both as weak. Don’t confuse empathy with sympathy! The difference is subtle but critical. Listen for the difference:

Sympathy: “I understand how you feel. I feel terrible for you.”
Empathy: “I understand how you feel, and I understand why you feel that way.”

What’s the difference? Merriam-Webster defines sympathy as the “inclination to think or feel alike,” a “feeling of loyalty,” and the “tendency to favor or support” – in essence, agreement. Sympathy almost never has a place at the negotiation table. In the negotiation of a business deal or at settlement discussions, few clients would want to hear their lawyer say to their adversary, “I get it – I agree it’s terrible what you went through. So here’s the check you asked for.” The sympathetic negotiator may not be much of a negotiator.

But the empathetic negotiator approaches things differently. Consider the Merriam-Webster definition of empathy: “the action of understanding, being aware of, being sensitive to, and vicariously experiencing the feelings thoughts, and experience of another.” The use of “vicariously” is critical here: unlike the sympathetic negotiator, the empathetic negotiator understands her adversary’s position, but doesn’t actually experience it or necessarily agree with it. Instead, she uses empathy to let the adversary know that she hears and understands him. By tuning into her adversary’s emotions instead of just the words, the empathetic negotiator shows that she “gets it,” which helps the adversary open up and share additional information that the empathetic negotiator can use to her advantage. Think, “I get it – I understand why you feel that way. So what if we…”

Think how much more effective a negotiator you can be if you understand what’s important to your opponent and the factors that got him there. Rather than taking a shot in the dark about what might work or keeping the focus solely on you (or your client), when you understand your adversary and use his own views to shape the conversation, you can strategize around that and go a lot further, a lot faster.

Too many negotiators are hell-bent on appearing authoritative, unflinching – like the “tough guy,” willfully ignorant of the forces shaping the other side. But that’s an incredibly weak negotiation strategy. Using empathy as a tool to make your adversary keep talking and feel comfortable is key to letting the other side get what you want.

Leadership and Law: Historic Examples of Leading American Lawyers

Posted: September 26th, 2019

By: Patrick McCormick, Esq. email

Published In: The Suffolk Lawyer

Tags: management

In honor of this year’s 50^th anniversary of the historic Apollo 11 Moon Landing, it seems appropriate that Americans look to the past, not only to see how far we’ve come, but to realize how extraordinary some of the achievements of our forebearers were and to inspire us to similar feats of excellence and innovation in the future. Those who exhibit excellence and innovation, who exhibit a leadership which shows humanity what they could and should be, can be found in every walk of life and every field of study. Perhaps some of the clearest examples of leadership can be found in the diverse history of America’s lawyers.

From the colonial era through the present day, American lawyers have been leading the way in utilizing the law to create a more just and equitable society. They took unpopular, even dangerous positions at times, knowing that to lead is to follow your conscience. Whether that is by using the law as training for the political arena and presidential leadership as Abraham Lincoln did, or asserting their own rights under the law at a time when this was controversial as Margaret Brent did, or through arguing landmark cases as Thurgood Marshall did, there are many ways American lawyers have historically shown leadership.

Many American lawyers have shown leadership through the practice of the law itself. Margaret Brent (1601-1671) became the first colonial woman to appear before a common law court in her duties as the Governor’s attorney and executrix of his will in 1648. She also requested a voice in the assembly and two votes, one as a landowner in her own right and one as the Governor’s attorney. John Adams (1735-1826) represented the British soldiers accused of murder at the Boston Massacre in March 1770, despite both his objections to British actions towards the colonies and his own fear of tarnishing his reputation, believing that everyone should get a fair trial. Thurgood Marshall (1908-1993) had a long and distinguished career arguing civil rights cases, starting with Murray v. Pearson (1934) and culminating in Brown v. Board of Education of Topeka (1954). His success provided a legal basis for arguments that separate but equal was unconstitutional and helped pave the way for the Civil Rights Act of 1964. The actions of these lawyers were strictly within the law, their stage was the courtroom and yet their words set lasting precedent for women’s rights, civil rights and the belief that the law should be impartial and just to all.

American lawyers have also shown leadership by applying the law outside the courtroom. Henry Clay (1777-1852) had his own legal practice for over 50 years but was also a U.S. Senator, Representative and Secretary of State. He was influential in developing the early U.S. legal system as distinct from but built upon the English tradition, and his debate, oratory and compromise abilities helped prevent the Civil War for several decades. Richard Henry Dana, Jr. (1815-1882) joined the Merchant Marines in his youth and eventually specialized in maritime law but was also a distinguished writer. In his Two Years Before the Mast (1840), a memoir from his years at sea and an American classic, he brought the plight of sailors to the public’s attention. Belva Lockwood (1830-1917) became the first female attorney to be allowed to practice before the U.S. Supreme Court. She also ran for president in 1884 and 1888 – the first woman to appear on official ballots – and drafted an anti-discrimination bill passed by Congress in 1879. From applying law to the political sphere to the field of writing and to women’s rights, these American lawyers were also leaders outside the courtroom.

Finally, some American lawyers have led by acting outside the law, only to be vindicated by history and time. Perhaps we could point to Abraham Lincoln (1809-1865), who suspended habeas corpus in 1861 and 1862 to preserve the Union and was retroactively granted the power to do so by Congress in 1863. Or we could speak of Lyda Burton Conley (1869-1946) who challenged the government in Court over the sale of the Huron Cemetery in Kansas City. The first attorney to argue that burial grounds for Native Americans should be entitled to federal protection, when she lost the case, she and her sisters took to guarding the cemetery themselves against all trespassers. In 1916, with the support of the Kansas Governor, the Huron Cemetery was established as a federal park.

There are as many ways to exhibit leadership as there are ways in which to practice and apply the study of law. What is clear is that law and progress are inextricably bound together, and that American lawyers hold a unique place in their ability to utilize the law to lead America into the future.

Thank you to Michelle Toscano for her research and writing assistance with this article.

When to Call it Quits in Negotiation

Posted: August 29th, 2019

By: Joe Campolo, Esq. email

Tags: negotiation

When it comes to negotiation, sometimes you have to just walk away.

When a negotiation is going well, and you and your adversary have reached a win-win (or at least a win-not lose) deal, it’s obvious when to stop negotiating. But when a negotiation turns tense or difficult, how do you know when to push through and keep going, or stop and move on? Here are some signs it’s time to call it quits.

1. “It’s just not fair!”

It’s human nature for negotiators to determine their preferred outcome, then justify it based on fairness. A recent blog post from the Harvard Law School Program on Negotiation gives a great example: the Winklevoss twins’ case of “settler’s remorse” after receiving a $65 million settlement from Facebook. Arguing that Facebook had cheated them out of hundreds of millions of dollars, the twins waged an expensive and time-consuming battle based on dubious legal grounds to undo the settlement, claiming to be motivated not by money but by fairness.

The alleged pursuit of fairness can be a slippery slope. As the Harvard blog points out, say you’re splitting up with your business partner. Of course, you feel that you deserve a bigger slice of the pie, because you invested more money. But your partner feels that she deserves a bigger slice – because she invested more time. Our natural egocentrism can destroy a negotiation. If the negotiation has hit a wall because you or your adversary are claiming unfairness, take a step back. Ask a colleague or mentor for an objective reality check. It may be time to consider your opponent’s perspective more carefully – or move on.

2. You’re negotiating with the devil (or so you think).

Disputes can drag out over long periods of time – lasting months or even years. With each passing day, frustrations rise, impatience grows, and it becomes easier for the parties to stop seeing the humanity in each other and instead start to demonize each other. Ask yourself honestly: are you continuing to fight it out because you think you can get a better outcome, or because you want to stick it to your opponent? There’s tenacity, and then there’s obsession. In this situation, it may be helpful to ask a trusted advisor or colleague for an honest assessment about whether this fight it still worth pursuing.

3. No one’s budging.

Sometimes in a tense negotiation, no matter how much you prepared beforehand or how carefully you’ve determined your BATNA, a deadlock occurs and the parties simply cannot reach an agreement. When this happens, take some time to reconsider your own position and make sure you are actively listening to the other side’s concerns. (See some other tips here.) The deadlock may be a temporary setback that can be overcome. Still no movement? It may be time to walk away.

These difficult scenarios demonstrate why success in negotiation depends so strongly on your understanding of the psychological principles at play across the table. You owe it to yourself to prepare thoroughly and to keep in mind that a final resolution might not occur in the first round of negotiations. Calling it quits is a last resort, not a first.

The Second Circuit Declines to Extend the U.S. Supreme Court’s McDonnell “Official Act” Reasoning to the Foreign Corrupt Practices Act

Posted: August 23rd, 2019

Published In: The Suffolk Lawyer

Tags: international

In 2016, in McDonnell v. United States, the U.S. Supreme vacated the former Virginia Governor’s bribery conviction by limiting the definition of what constitutes an “official act.” Critics argue the McDonnell decision legalizes, or at least substantially shields, public corruption and has already served to overturn (at least temporarily, in the case of former New York Assembly Speaker Sheldon Silver) convictions of other public officials. However, in a decision likely welcomed by good governance advocates, on August 9, 2019, the U.S. Court of Appeals for the Second Circuit declined to extend the McDonnell “official act” requirement to Foreign Corrupt Practices Act (FCPA) prosecutions, affirming the conviction of Chinese real estate developer Ng Lap Seng.

On June 7, 2018, the U.S. District Court for the Southern District of New York (Broderick, J.) ordered Ng to serve concurrent 48-month prison terms after a jury convicted him of paying and conspiring to pay bribes in violation of 18 U.S.C. Sections 371, 666, and the FCPA, 15 U.S.C. Sections 78dd-2 and 78dd-3. Ng, a billionaire real estate tycoon, paid more than $1 million to two United Nations diplomats to secure a U.N. commitment to use Ng’s latest Macau-based hotel and convention center as the site for an annual U.N. conference.

The prosecution’s evidence at trial was detailed and overwhelming. For instance, in exchange for monthly payments of $20,000 for alleged services rendered to one of Ng’s media companies, one U.N. diplomat and cooperating witness testified his “salary” was in fact bribes to secure for Ng not only general U.N. support for using the convention center, but also a formal documented commitment to do so. In another instance, the then-President of the U.N. General Assembly travelled to Macau with U.N. staff to visit the convention site in exchange for a payment of $200,000 to the Office of the President of General Assembly. The diplomats secured official letters and other records of ambassadorial support for Ng’s project and an early commitment to hold the annual conference at Ng’s facility. Diplomatic efforts to finalize the U.N.’s commitment to the convention center were abandoned in September 2015 following Ng’s arrest.

The bulk of Judge Raggi’s opinion addressed Ng’s argument that his conviction under 18 U.S.C. Section 666, which criminalizes theft or bribery concerning programs receiving federal funds, cannot stand because the U.N. is not an “organization” within the meaning of the statute. Judge Raggi used precedential, textual, and historical analysis to hold that public international organizations, such as the U.N., are covered by Section 666 before moving on to Ng’s McDonnel challenge. That the court, however, may have buried the lead as its holding regarding McDonnell’s application to the FCPA is arguably more significant than its holding regarding the U.N. falling within Section 666’s definition of an organization.

Ng argued the FCPA requires proof of an official act satisfying the McDonnell standard and the district court’s jury instruction failed to satisfy that standard. At issue in McDonnell was whether “arranging a meeting, contacting another public official, or hosting an event—without more—concerning any subject, including a broad policy issue such as Virginia economic development,” qualified as an “official act” as defined by 18 U.S.C. Section 201(a)(3). In holding these actions did not qualify, the Supreme Court reversed McDonnell’s conviction and identified two requirements in the statutory text to prove an official act under Section 201: first, the government must identify a “pending” question, matter, proceeding, or controversy that involves the “formal exercise of governmental power.” Second, the government must prove the public official took an action on that pending matter. Ng argued not only did the district court not properly instruct the jury, but the facts at trial did not prove an “official act” by the U.N. diplomats.

Judge Raggi begins with the premise that there is no universal statutory definition for what constitutes a “bribe,” but at the very least all involve a quid pro quo. However, not all federal statutes define the “quo” in the same manner, much less an “official act” of Section 201. The court reasons the very existence of different quos across related statutes demonstrates Congress did not intend all bribery or corruption-related laws to be treated identically to Section 201. Judge Raggi easily dispensed with Ng’s arguments vis-à-vis Section 666, as the Second Circuit in United States v. Boyland previously held McDonnell’s “official act” standard for the quo component of bribery does not apply to the “more expansive language of Section 666, which nowhere mentions “official acts.”

With respect to the FCPA, the court acknowledges the first quo references an “act or decision” of a “foreign official in his official capacity,” the FCPA does not cabin “official capacity” acts or decisions to a definitional list akin to Section 201’s understanding of official acts. According to the court, the FCPA is broader and includes, for instance, acts or omissions that violate an official’s “duty” or affect or influence the act or decision of a foreign government. Judge Raggi also observes the FCPA prohibits bribing a foreign official to “secure an improper advantage” in obtaining, retaining, or directing business without requiring the advantage be secured by an “official act.”

By declining to extend the McDonnell requirements to the FCPA, the Second Circuit is reinforcing the reasoning of its sister courts holding the “official acts” requirement of Section 201 does not bleed into other statutory anti-bribery regimes, including the FCPA. While prosecutors may find it more difficult to convict conventional domestic political bribery in a post-McDonnell world, corporate executives subject to the FCPA’s broad, extraterritorial reach cannot become complacent, particularly as the DOJ seeks ever more to hold individuals criminally liable for acts of international business corruption.

Getting the Home (or Away) Team Advantage in Negotiation

Posted: July 24th, 2019

By: Joe Campolo, Esq. email

Tags: negotiation

You’ve heard all about the importance of preparation, knowing your BATNA, active listening, and other critical tools to maximize your chances of success in any negotiation. But negotiators often overlook a vital aspect of deal-making that could make or break their success: the location.

If you think a conference room is just a conference room, think again. Location means far more than the pictures on the wall and the wood color of the table. Whether your exchange takes place in your own office, on your adversary’s property, or at a neutral site – and even if the location isn’t ultimately up to you – you can still take steps to gain an important advantage.

THE HOME TEAM ADVANTAGE

Just as most sports teams prefer to compete on their own turf, most negotiators probably prefer to compete in their own location. As the host, a negotiator can gain control over the negotiation before it even begins.

First, the host gets to select the room in which the conversation will take place. To many, this seems like a mindless task, but to a successful negotiator, room selection and setup requires consideration. The right location depends on what you’re trying to accomplish. Will the negotiation be relaxed and friendly, or perhaps more serious and competitive? From there, you must consider the features of your room, what mood they may elicit in your opponent, and alter them if needed.

The Décor: It’s unrealistic that you’d change the décor of a room each time you have a meeting, but depending on the mood you want to set, you can choose intelligently between your conference room, your own private office, or elsewhere. To set the stage for a friendly negotiation, choose a more homey space with cupboards or bookshelves; this setup can help relax your adversary and give the impression that you’re looking for a win-win outcome. Or are you looking to show your opponent that he or she is in for a tough debate? Choose a site with an “ego wall,” complete with your awards and framed newspaper clippings. This setup not only creates a competitive, almost intimidating atmosphere, but also showcases your confidence – and appearing confident might even help you gain you a greater level of respect and give you an easier time getting what you want.

The Seating Arrangements: Just like the room’s décor, the seating arrangements should differ based on your strategy. Trying to strike a friendly tone? Consider putting the seats closer together and more offset than directly head on. Setting up for a more formal meeting with multiple parties? Create distance between the chairs and set them more head on. The distance will lessen the chance of emotional reactions while the head-on direction helps establish a more competitive atmosphere.

The Lighting: Insufficient lighting has been found to contribute to moodiness and depression, while bright lights can heighten emotions. A 2014 study found that people with access to natural light will have a greater sense of overall wellbeing than those without windows. Is your dark conference room stifling the discussion? Try switching to a different room with abundant natural light.

Drinks: Just as with lighting, research has shown that even the temperature of certain food and drinks can affect a person’s overall mood. Some researchers believe that the temperature of an object we hold in our hands impacts how we perceive the world around us at that moment. So if you have a tense negotiation on your hands, you may want to offer hot coffee instead of a cold soda.

SUCCEEDING AS THE AWAY TEAM

Being the “away team” at a negotiation can be intimidating – you are unsure what the negotiation environment will be, you will have fewer (if any) of your colleagues nearby, and the only resources at your disposal are those you brought with you. Nevertheless, many aspects of being the away team can give you a level-up on the competition.

Gather As Much Information As You Can: On site at your adversary’s business? Take advantage of the opportunity to look around for any clues that might help you negotiate. Perhaps the condition of equipment, number of employees, or other observations can be used to help you later.

Radiate Confidence: Remember, your competitor is in their comfort zone. You were willing to travel to their home. With that, you are showing confidence in your negotiation skills and position. Remind yourself that if you didn’t think you would triumph, you wouldn’t have wasted your time traveling.

Limited Resources May Be a Good Thing: You should never show up to a negotiation ill-prepared, but as the visiting team, you can always buy time with the excuse that you don’t have certain information on hand. Take the position that your host has no just reasoning as to why he or she can’t explain a claim or back up a position with evidence – all the files are right there. Don’t be shy about pointing that out.

Just Move It: Maybe your competitor set up the room with his or her own comfort in mind, but who says you can’t change it? If you are uncomfortable with the seating arrangements in the negotiation room – the chairs are too far apart or there is a light shining in your eyes – just move your chair. You’ll get more comfortable and project confidence.

A NEUTRAL SETTING

Meeting at a neutral location? There are still steps you can take to steer things your way:

Background Noise: Are you expecting a challenging and lengthy negotiation? Consider a quiet setting such as a hotel conference room; a pause in conversation will be met with silence, which both conveys seriousness and could even prompt your adversary to keep talking to avoid awkwardness. Want to set a calmer tone and put your opponent at ease? Suggest a restaurant with a bit of background noise, which will allow for natural breaks in the negotiation.

The Impression: How important is this deal to you and your competitor? If this negotiation is key to your success, show that by suggesting an upscale environment.

The takeaway: if you haven’t adequately prepared for the negotiation or mastered the emotional principles at play at every negotiation table, the diplomas on the wall and the location of your chair won’t save you. But smart negotiators play up every advantage they can. As the saying in the real estate industry goes, “Location, location, location.” Don’t underestimate its importance in your next negotiation!

Design-Build for NYC Public Works Projects

Posted: July 18th, 2019

By: Don Rassiger, Esq. email

Tags: construction

In a long-awaited turn of events, Bill No. A07636, known as the “New York City Public Works Investment Act,” was delivered and subsequently passed by the New York State Assembly on June 19, 2019. The Bill is now before the New York State Senate awaiting a final vote.[1] The reception the current design-build legislation has received in the New York State Legislature is its most positive yet. It has been on the Assembly/Senate floor two times previously, in both the 2015-16 and 2017-18 Legislative sessions, both times being stalled and subsequently not passed. The current Bill, unlike its predecessors, has received overwhelming support in both the Cities Committee and Rules Committee (14-1 in favor and 25-0 in favor, respectively). While the proposed legislation has not been officially passed by the Senate and approved by the Governor, it is highly encouraging to see it moved through the New York State Legislature with such swiftness and support.

If enacted, the new law will allow certain New York City agencies[2] to use the design-build procurement model for their infrastructure projects. Design-build is a method of project delivery in which the owner retains a single contractor to provide turnkey design and construction services for the project. The design-build model has been used successfully in the private sector and more recently at the State agency level to complete projects on time and on budget. Having a single point of contact saves both time and money and permits the design and construction teams to work more efficiently.

Part of the reason why the implementation of the design-build system on New York State and City public works projects has been so vexing is the “Wicks Law,” which requires the award of separate prime contracts for mechanical, electrical and plumbing work on municipal projects over certain dollar thresholds. By requiring the municipal agencies to directly retain four separate contractors for each of the primary subdivisions of work, the Wicks Law precluded the single contractor design-build delivery system on projects of any significant dollar amount. Further, the agencies have interpreted the NYS Education Law as preventing non-licensed contractors from offering professional design services. Even though the design services would continue to be signed and sealed by appropriately licensed design professionals as subcontractors to the design-builder, the restrictive interpretation of the Education Law handcuffed the agencies from reaping the benefits of the design-build delivery system.

The impasse was finally broken through the passage of the New York State Infrastructure Investment Act, which permitted a select few state agencies to engage in design-build contracts in recent years notwithstanding the prohibitions of the Wicks Law and Education Law. The results were immediate and overwhelming. Specifically, the design-build delivery system enabled the NYS Thruway Authority to complete the Tappan Zee Bridge replacement project in August 2017 – more than a year ahead of schedule and approximately $1 billion less than what the State projected. The success of the Tappan Zee Bridge Project has opened the door to more than 30 other public works projects where the design-build project delivery method is being utilized, such as the Kosciuszko Bridge Replacement Project, the Rehabilitation of Atlantic Avenue Viaduct Project, and the reconstruction of the BQE.

While the State agencies have been reaping the benefits of design-build projects, the City agencies have not. The hope is that is about to change. The NYC Public Works Investment Bill that is making its way through the NYS Legislature mimics the NYS Infrastructure Investment Act and will allow NYC agencies to utilize the design-build delivery system on the City’s infrastructure projects. Under the applicable provisions of the pending legislation, the “design-build contractor” may be a team comprised of separate entities, thus eliminating the separate prime contractors required by the Wicks Law. The Bill also proposes that the design-build project must be subject to a Project Labor Agreement.

Further, the Bill resolves the NYS Education Law impediment by enabling the design-builder to provide the professional services regulated by Articles 145, 147 and 148 of the Education Law through the appropriately licensed design firms that are retained by the design-build contractor.

In effect, the NYC Public Works Investment Act would codify the New York Court of Appeals’ decision in Charlebois v. J.M. Weller Associates, Inc., 72 N.Y.2d 587 (1988), which elicits the principle that a contract, which includes an express requirement for a separately retained licensed professional to perform the design function of a project, does not violate the licensing protections of the Education Law when the professional services are provided through a subcontractor. As the Court of Appeals held over 30 years ago, when the design-builder places in writing its duty to find the appropriate individual/entity that possesses the proper professional licenses to engage in the specified “design” services aspect of a project, the design-builder does not run afoul of the Education Law.

The Bill, having passed the New York State Assembly, now only waits to be passed in the NYS Senate. If the Bill passes the Senate and is signed into law, it would take effect immediately. The Bill also has a sunset provision, through which the law will expire and be deemed repealed three years after enactment, unless extended by the State.

CMM will continue to monitor the status of this Bill and keep our clients informed.

Thank you to Brendan Mahon for his research and drafting assistance with this article.

[1] While the Bill is not guaranteed to pass, it appears more likely than prior attempts. In 2015, similar legislation was stalled in the Cities Committee and Rules Committee of the Assembly and Senate.

[2] The authorized NYC agencies are: Department of Design and Construction, Department of Environmental Protection, Department of Transportation, Parks and Recreation, Health and Hospitals Corporation, School Construction Authority, and NYC Housing Authority.