If we take the view that Alternative Dispute Resolution (ADR) has three main traditional formats, these being Mediation, Arbitration and Adjudication; from a commercial perspective, Mediation will in all likelihood be the first step in resolving a dispute by ADR, as it’s the least confrontational.

What are the key elements of mediation then?

At its simplest form a mediator, will be a third party, acting impartially, to assist two parties to negotiate a settlement to a dispute. This would usually be without the need to go to litigation or Arbitration and where available as a remedy, Adjudication. Mediation could be on anything relating to the two parties, such as commercial, legal, workplace relationships etc. A marriage guidance counsellor could be regarded as a Mediator even.

For example, two people who work for an organisation could end up having a disagreement which compromises their working relationship, where a line manager becomes involved to try to resolve the disagreement this would be a very basic form of mediation.

If we were to define mediation it would be as follows:

Mediation refers to any instance in which a third party helps others reach agreement which has a structure, timetable and dynamics that “ordinary” negotiation lack. The process is private and confidential, possibly enforced by law with voluntary participation typically where the mediator acts as a neutral third party and facilitates rather than directs the process.

As mediation is an informal type of dispute resolution it has a number of perceived benefits, amongst these are the following:


A mediator (particularly if an external party) may charge a fee that is very similar to the hourly charge out range of a lawyer. The mediation process will generally take significantly less time than standard legal channels. A case in the hands of a lawyer or in the court system may take months or even years to resolve. Mediation can reach a resolution in anything from a matter of hours, to a few days.


Court proceedings are public and a matter of public record, primarily where case law has a significant weight in the legal decision. Mediation, by contrast remains strictly confidential and only the parties to the dispute and the mediator or mediators are privy to the discussions and outcome. Confidentiality in mediation has such importance that in many cases the legal system cannot force a mediator to testify in court as to the content or progress of mediation, save for where the mediation taking in elements that are themselves illegal, such as threatening criminal acts.


Mediation increases the control the parties have over the resolution as it is more likely to produce a result that is mutually agreeable for the parties. In a court case, the parties obtain a resolution, but control resides with the judge or jury and often a judge or jury cannot legally provide solutions that emerge in mediation, as they will have to interpret the dispute and their remedy in accordance with the law and based on the evidence and pleadings.


Because the result of mediation is achieved by the parties working together and is mutually agreeable, compliance with the mediated agreement is usually high. In the medium term this reduces cost and the parties to not have to employ a lawyer to force compliance with the agreement as a mediated agreement is fully enforceable at law.


Generally, the fact the parties are willing to mediate means that they are ready to “move” their position and typically are ready to work mutually toward a resolution This means the parties are more understanding of the issues of the other party’s side and work on underlying issues to the dispute. This can mean that the relationship the parties had before the dispute can be preserved following the mediation.


Mediators are trained in working with difficult situations. The mediator acts as a neutral facilitator and guides the parties through the process. The mediator helps the parties think “outside of the box” for possible solutions to the dispute, broadening the range of possible solutions

While in business Mediation is a relatively recent phenomena, particularly as the world has “got smaller” with technology linking us like never before;  requiring formalised contracts where previously a “Gentleman’s Agreement” may have sufficed. However Mediation’s origins can be traced back to ancient Greece and was also used in early Roman civilisations.

As Mediation has gained popularity as a form of ADR it has resulted in training programs which have resulted in certifications and licensing for these trained, professional Mediators. As a business technique Mediators use various techniques to open, or improve dialogue and empathy between the parties aiming to help them reach a mutually acceptable agreement. In a large number of instances, for this favourable outcome to occur, much will depend on the mediator’s skill, training and ability to bridge gaps by compromise between the parties.

Is Mediation effective?

If a dispute is relatively minor and has not been allowed to fester and poison relationships between the parties, it can be a cost effective solution. But where this point has reached, it may require the topic to look at next time, Arbitration.


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