Alternative Dispute Resolution (ADR)
ADR is a process by which disagreeing parties to come to an agreement short of litigation. It is a collective term for the ways parties can settle a dispute with the help of a third party. In fact, some courts now require the parties to submit their case to some type of ADR, usually mediation, before permitting the case to go to trial. The rising popularity in the use of ADR can be explained by the ever increasing caseload in the courts, the perception that ADR imposes fewer costs than traditional litigation, a preference for confidentiality; the process moving more quickly than court, and the desire to have greater control over the selection of the individual who will facilitate a settlement, or decide the dispute.
Mediation is a form of ADR, a way of resolving a dispute between two or more parties with concrete effects. Typically, a third party, the ‘Mediator’ will assist the parties to negotiate a settlement. The term “mediation” broadly refers to any instance which a third party helps others reach agreement. More specifically, mediation has the structure, timetable and dynamics that an ordinary negotiation lacks. The process is private and confidential, and participation is typically voluntary. The Mediator acts as a neutral third party and facilitates rather than directs the process unlike arbitration.
Arbitration is a form of ADR used for the resolution of disputes outside the courts, where the parties refer their dispute to an ‘Arbitrator’ by whose decision (the “Award”) is final and binding on the parties. Arbitration is a dispute resolution process where an Arbitrator, will allow limited discovery, conducts a hearing much like a trial, swears witnesses, hears testimony and takes evidence, and renders a decision which is legally binding and enforceable on the parties. Arbitration can be either mandatory or voluntary. Mandatory arbitration can come from operation of law (statutory), or from an agreement which is voluntarily entered into by the parties where they have agreed to take existing and future disputes to binding arbitration. Daytime TV court room shows are essentially arbitration – parties agree to dismiss their lawsuit, usually in small claims court, and agree to binding arbitration.
Fact-Finding is the use of a ‘Neutral Expert’ selected by the parties, the organization or agency, or by an individual with the authority to appoint a Fact-Finder to determine what “facts” are in a dispute. The Fact-Finder may be authorized only to investigate or evaluate the matter present and file a report establishing the facts in the matter. In some cases, the Fact-Finder may be authorized to issue either a situation assessment or specific procedural or substantive recommendations as to how a dispute might be resolved. If used as an ADR technique, the findings of fact must remain confidential.
Mini Trials are normally structured as a trial structured/settlement process during which the sides to a dispute present a summary of their case before the major-decision makers on a panel which includes a Neutral who oversees the Mini-Trial. The Neutral is responsible for overseeing the process and explaining the procedures. After case presentations have closed, and all questions have been answered, the Neutral who is overseeing the Mini-Trial, then meets with the parties and facilitates settlement discussions. In employment cases, mini-trials are a favored when dealing with disputes concerning key executives termination of employment or in employment-related disputes that would otherwise have high visibility on TV or printed media, Facebook, MySpace, etc. Parties who have a mutual interest in maintaining substantial level of control over the publicity that would be involved in a longer resolution of the dispute tend to also favor mini-trials. Experience shows that mini-trials are useful and favored when the issues are very technical in nature such as employees that work with intellectual property, or confidential information, disputes over bonus programs, incentives, etc., or where a public trial on the merits of a discrimination charge or an employment contract dispute, would be long, complex and run the risk of making public facts and figures about a company that are not otherwise known.
Considered to be one step above mediation in ADR practice. The parties can through all of the motions of a traditional arbitration only to end up with an award that is non-binding on the parties. Should the parties not settle – they may be forced to repeat the entire process at trial, an administrative hearing, or in binding arbitration. Non-binding arbitration is more flexible and private than arbitration proceedings and the informal exchanges can be kept more confidential. Parties can agree to appoint an experienced arbitrator with expertise in the particular field of their dispute. The advantage to the parties is the ability to reject the award and seek trial or a full binding arbitration before a new arbitrator. The process also forces the parties to complete discovery early in the dispute process.
Summary Jury Trials
This method of ADR crosses the line into the court room. Some courts have used one or two day summary jury trials as a way of having a jury evaluate a case on either a binding or non-binding basis. While similar to arbitration in that it may be binding or non-binding, a summary jury trial differs because jurors are being utilized in a jury trial type setting. Each party will present its case before a third-party neutral, and a jury will render its verdict by the end of the day. From a practice standpoint, depending on the agreement by the parties, the process can be binding or non-binding and the parties can floor and cap damages by stipulation. The parties may also limit preparation, discovery, and motions for summary judgment, etc. so as to bring closure to the process as quickly as possible.
Many collective bargaining agreements include procedures for handling employee grievances, with binding arbitration as the final resort. Grievance-Mediation provides parties with an opportunity to mediate a grievance before it reaches the more costly stage of arbitration. The mediator guides the parties to a mutually acceptable settlement of the grievance and works with them to improve their settlement techniques. The mediator has no authority to compel resolution; and, if the parties cannot settle the matter, they may proceed to arbitration or other processes as provided in their collective bargaining agreement. Grievance-Mediation is particularly useful in workplace environments where grievances tend to linger and are not resolved expeditiously, i.e., the “distressed grievance procedure”. What are the Benefits of Grievance Mediation?
- Expedites the grievance processing and eliminates complaint backlog;
- Allows individual grievants, union and management representatives to air, and potentially settle their differences utilizing a neutral third party;
- Identifies common workplace problems and provides an opportunity to resolve them on a broader scale;
- Evaluates the strengths and weaknesses of the grievance prior to arbitration;
- Permits the parties to return to established grievance-arbitration mechanisms if a settlement is not reached.