May 30, 2012
When business owners are faced with a major legal dispute, mediation can often serve as a viable alternative to litigation.
The mediation process allows the participants, with the assistance of neutral parties, to systematically isolate disputed issues in order to develop alternative options and reach a consensual settlement accommodating each party’s needs. This type of arrangement emphasizes the participants’ independent responsibility for making decisions. Mediation therefore becomes a self-empowering process for all parties involved.
Mediation can be preferable to litigation for a number of reasons including privacy, confidentiality and control. In addition, mediation tends to be less expensive and have a quicker timeline for resolution. Consider the benefits of resolving a dispute without the presence of court reporters, a jury, clerk, judge, bailiff and journalists. A private office is much more comfortable, and no record of the discussion that occurs during mediation is kept.
Common types of mediated disputes involve employee and employer disagreements, personal injury, on-the-job accidents, workman’s compensation, product liability, sexual harassment, and discrimination. All statements made during these types of proceedings are confidential and cannot be used at a later time against the person making the statement. The enforcement of the confidentiality protection allows all parties involved to be more honest and open with the mediator.
The mediator uses what he or she has learned in confidence and offers guidance and direction to negotiations. The mediator is not retained to tell the parties how to act or what they consider the case to be worth. He or she is only there to guide and advise negotiation strategy, not to give opinions.
Arbitration involves increased rules, procedures and the intervention of a third-party adjudicator, which is typically a judge or jury. There is, by definition, a lack of control on the part of the plaintiff and the defendant in a typical trial. Not to mention, the process can expensive and drawn out.
Typically, mediation is scheduled and resolved within one day and costs no more than an attorney would charge to prepare for and record an average deposition. It’s easy to see why mediation is often the preferred alternative form of dispute relation for many local business owners.
However, the mediation process does have its critics. There are those who do not trust the process due to a negative experience. Others simply prefer the competition of the trial arena. The most common critique is the concern over case precedent, which gives meaning to our state and federal statutes. The fact is that there are a certain number of cases which will never settle through the mediation process, the negotiation process or any other manner short of trial. Those cases will continue to provide precedent to our state and federal statutes.
An easy way for a business to protect itself from future conflicts is to include a mediation clause in any contract signed. Mediation clauses are increasingly being included in contracts either in place of arbitration clauses or as a precondition to arbitration and/or litigation. The use of mediation clauses in employment makes tremendous sense.
Including this type of clause ensures that any disputes that may arise will not create the negative atmosphere in the workplace which can be caused by litigation. Be smart and protect yourself and your business by considering mediation as an alternative to traditional litigation.
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