Difference between Arbitration and Mediation

It’s important to help others identify the difference between Arbitration and Mediation. We all have either signed our rights over to resolving conflict by way of dispute resolution in most contracts you sign off. This means, buying or selling a home, cell phone companies, your Apple phone, and all other fun gadgets you decided to buy. This is to help push the consumers to resolve their disputes in a more controlled way than a lawsuit. This is Arbitration.

It’s also important to understand both aspects of dispute resolution so you are aware and understand how such can help benefit your bottomline when your are faced with a dispute within your own life. For example, family, business or workplace employee disputes. This is where Mediation comes into play.

So let’s dive deeper into this and ensure you walk away from this article understanding the differences.

1. Decision-Making Authority

Arbitration: the arbitrator has the authority to make a final and binding decision, similar to a judge in court.

Mediation: the mediator facilitates communication between parties but does not have decision-making power; instead, the parties themselves come to a mutually acceptable resolution.

2. Formality

Arbitration: proceedings are generally more formal, resembling court trials with formal rules of evidence and procedure.

Mediation: is typically less formal and allows for more flexible and informal discussions between parties.

3. Role of Third Party

Arbitration: the third party (arbitrator) acts as a neutral adjudicator who evaluates evidence and arguments presented by both parties to render a decision.

Mediation: the third party (mediator) facilitates communication and negotiation between parties to help them reach a voluntary settlement.

4. Binding vs. Non-Binding

Arbitration: results in a binding decision that the parties are legally obligated to follow, similar to a court judgment.

Mediation: produces a non-binding agreement that only becomes legally enforceable if the parties choose to formalize it into a legally binding contract.

5. Control Over Outcome

Arbitration: parties have less control over the outcome since the decision is ultimately made by the arbitrator based on the evidence and arguments presented.

Mediation: parties retain more control over the outcome since they actively participate in negotiations and ultimately decide whether to accept the proposed settlement.

Don’t worry, we can delve deeper into this topic if you’re seeking a better understanding of the differences and when and where they should manifest, depending on the type of dispute you’re encountering. Don’t mind our plug, but we also specialize in Mediation. If you find yourself in such a predicament, please visit our contact page and get in touch with us.

Author: The Impartial Lab. (M.TIL)