Arbitration is a form of Conflict Resolution where the parties agree to let a neutral third person hear all the fact of the matter and then make a final decision in the case. Arbitration is designed to keep the case out of the court system. Mediation, on the other hand, also uses a neutral third-party to guide questions and try to help the parties come to an agreement, but the mediator can’t make decisions. An arbitrator will make a decision in favor of one or the other by the end of the meetings.
Mediation-Arbitration
This combined form of these two methods is for those who are willing to try mediation but don’t expect to come to an agreement. They’re giving the mediator the right to decide later that mediation isn’t working. In that case, the mediator switches things form being arbitrator, and in the end he’ll make a final decision in the case. Commercial venture disputes and those involving labor and management are often ended with arbitration.
Mandatory Arbitration
In cases of labor management cases and some employee and consumer matters, those involved don’t have a choice as one would otherwise. Arbitration is the only choice, and the employee doesn’t even have access to the court system for help in the matter. When arbitration is the only option offered, then it’s mandatory arbitration. Voluntary arbitration is when the parties agree to have someone make the decision in the end while knowing that they could go to court.
Internal Arbitration
This is the type of arbitration that goes on within an organization. Through their contracts or other binding document the parties agreed to go to arbitration if a conflict should arise. A neutral third party presides but it’s an informational type of meeting.
The Arbitration Agreement
Arbitration is like mediation in the rather gentle way the neutral third party will guide the parties to come to a fair agreement. But some agreements are worded so as to limit the right of one of those in arbitration. Agreements like this will contain a clause that states if a dispute arises, it’ll be disputed through arbitration. This is known as an arbitration clause. The other kind of agreement is sometimes called a submission agreement. This an agreement signed after the dispute began.
Is Arbitration Unfair?
Both positions can be unfair to one side of the argument. If person signs a contract under duress or a full lack of understanding about what he or she is getting to, especially if the contact clearly favorites the other party, that’s clearly unfair.
Arbitration Laws
A fairly extensive set of laws apply to arbitration. There are government and federal laws regarding arbitration that must be followed. The tribunal and proceedings have special laws. The area of law covering whatever the dispute is involved will play a part, as will the law governing at items involved.
The Arbitration Award
If the arbitration were a lawsuit, then the money or other goods you would be granted at the end would be called a settlement. In arbitration anything you’re granted from those meeting is known as the Arbitration Award. If the party asking for the award is asking too little or too much for the situation, the mediator or arbitrator can bring this to their attention, but cannot change the amount.
Arbitration is Final
The reason it’s so important that arbitration be fair, even more so than other methods of conflict resolution, is that one person gets to make the decision in the end. Unlike a court decision that you could appeal, the decision handed down by an arbitrator is final and binding. It can’t then go before a court or be judged. This is one reason that arbitration isn’t used nearly as often as mediating.
No Appeals in Arbitration
The process of taking the Arbitration Award before the court and having it confirmed is something many lawyers refer to as appeals quite mistakenly. This action only makes the award enforceable like any other order of the court. The judge has no say in how or when they plan to collect, and can’t make any changes, but only enter it into the record so if the debtor doesn’t pay, the court can order it to be paid .
What an Arbitrator Can Do
If at some point during the arbitration it appears than you can reach an agreement after all, or for any other reason, the arbitrator can withdraw and leave the negotiations so that the parties can make their own decision.