In this paper we are going to be examining the process of mediation and arbitration. This will be accomplished by focusing on the benefits and advantages of both. Once this takes place, is when we will compare how these ideas are used to create a new process call Med-Arb. This is the point that we will illustrate how the field is continually evolving.
Mediation and Arbitration
How do the relative advantages of mediation and arbitration, create a synergy in a combined strategy of MED-ARB?
Both mediation and arbitration have been used for many years to settle different disputes. This is because they have a number of advantages most notably: they save time, money, offer both parties with privacy and it circumvents the courts. However, depending upon the method that is selected, the finality of the decision will be different. This is from each approach having contrasting practices and procedures that are embraced during the process. ("Foundations of Conflict Resolution," 2012) (Shachar, 2011) (McLean, 2008)
In the case of mediation, this is an informal procedure, where a neutral third party is working to resolve the dispute. There are no formal rules that are established. Instead, mediators will work with both sides to create an agreement that is acceptable. It is up to the individual parties to follow any decisions of the mediator. ("Foundations of Conflict Resolution," 2012) (Shachar, 2011) (McLean, 2008)
As a result, mediation has been shown to be effective in successfully resolving 85% of disputes. This is because it is offering a number of benefits including:
It builds long-term relationships by having both sides constantly working together to resolve the conflict.
Since the decision is not binding, there are low risks for each party agreeing to the process.
The program is voluntary. This means that nothing occurs without the consent of both sides.
It builds trust and communication.
This is illustrating how mediation is a low risk solution that offers both parties with privacy it explores for numerous options. When this happens, there is a greater probability of creating an outcome that is acceptable to the different sides. ("Foundations of Conflict Resolution," 2012) (Shachar, 2011) (McLean, 2008)
Arbitration is a binding process. As it could be court ordered, mandatory or voluntary. The two primary areas where this is used as a form of alternative dispute resolution are with: labor and international commerce issues. During this process, the arbitrator will work closely with both sides to understand their position (while remaining objective). What makes arbitration so attractive is the finality that it is offering in ending the dispute. ("Foundations of Conflict Resolution," 2012) (Shachar, 2011) (McLean, 2008)
There are several different benefits that are provided to both sides these include:
Privacy: Any kind of arbitration is not open to public. This means that there are no comments about the negotiations or the positions taken by the different sides. In a legal proceeding, the press and other parties will have access to the topics that were discussed. This prevents information from being leaked, which could hurt negotiations.
Informal and Flexible: Arbitration is not following a formal structure. This changes the time and place when these proceedings can occur.
Economical: The process is saving time and money by not involving the courts in settling the dispute (which could take years).
This is illustrating how arbitration is advantageous because it can help both sides to quickly resolve key issues. ("Foundations of Conflict Resolution," 2012) (Shachar, 2011) (McLean, 2008)
Mediation -- Arbitration (Med-Arb) is a procedure that is combing the two strategies together into a single model. The way that is works is each side will agree to abide by the final decisions. However, during the process, mediation is used to determine the positions of both sides and their flexibility. (McLean, 2008)
This increases communication and it allows for trial offers to be presented to the other party. These kinds of proposals help to enhance communication and it improves everyone's ability to understand the main issues. When this happens, there is a better working relationship that is acceptable to all parties. (McLean, 2008)
This is the point that both sides will enter final arbitration. After a successful test agreement has been presented and accepted by everyone, is when this process will be used to create a final offer. This is a legally binding document and will take the elements from the mediation by implementing them in the final proposal. (McLean, 2008)
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