Negotiation v Mediation: some key considerations

DIGEST | ISSUE 20
However, in order to have a
reasonable chance of success,
negotiation requires the parties to
engage with one another openly,
and to organise the meeting in a
way that allows their discussions
to flow, as there is no neutral party
to aid the meeting, and facilitate
those interactions. On the positive
side, the lack of a third person
offers flexibility to the parties to
manage the meeting on their terms
and in line with their timescales.
The process is often quicker as
a result, as it requires only the
parties and the meeting itself to be
organised, avoiding the processes
and procedures that are required
to arrange a mediation, or other
similar forms of alternative dispute
resolution.
Negotiation v Mediation:
Some key considerations
Laura Geary, Consultant,
Driver Trett, London
One of the fundamental misconceptions relating to the
various alternative dispute resolution (ADR) options available
is that negotiation and mediation are the same.
However, they are in fact two very different ways of resolving a dispute, and it is
key to know their differences when deciding what is the best route to facilitate
discussions and reach an outcome which is acceptable to both parties.
Negotiation
Negotiation provides a forum where the parties rely on each
other, rather than a third party, to reach a resolution.
It does not require a special skill, or particular expertise, although
experience and an open mind will generally assist. Indeed, most parties will
find themselves negotiating at various points during the course of a project,
even if they are not specifically aware of it at the time. Negotiation can be
the best way of resolving a dispute, as sometimes it is a matter of more
open lines of communication which helps to secure an agreement.
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terms due to pressure or a lack of
time and/or resources to take the
discussions further.
In summary, the lack of a neutral
person facilitating discussions
between the parties can be seen
as a disadvantage of negotiation.
However, that same reason offers
the parties the freedom to construct
the discussions on their own terms.
Furthermore, the parties are in
control of these discussions, which
can lead to an agreement and this
means they make the choice to
bind themselves at the end of the
process, if an agreement has been
reached.
Another benefit of negotiation is
that it is often a very cost-effective
method of resolving disputes, as it
disposes of the need for third party
fees and for the resulting meeting
room facilities, relying on just the
two parties talking at a venue to suit
their requirements.
However, for all its inherent
advantages, it is important to
remember that, with negotiation,
personal feelings and emotional
responses can often get in the
way of making progress on the
matters in dispute. The absence of
an independent third party means
that parties might find themselves
arguing endlessly about one
particular issue, without making
progress, and without seeing the
bigger picture and understanding
what might be required to reach a
resolution.
Another major problem with
negotiation arises when there is an
imbalance of power between the
parties, with a smaller firm pitted
against a larger or more powerful
organisation, or where the revenue
of one party is heavily dependent
on continued workflow from the
other party. In these kinds of
circumstances, one party might
find itself agreeing to unfavourable
Mediation
Mediation
is
facilitated
through the guidance of
an official mediator, who is
trained and experienced in
the art of helping the parties
to reach an agreement (or
compromise) and settle the
dispute at hand.
Mediation can be a good next step if
negotiations are unsuccessful, as a
mediator can help guide previously
stalled conversations in a positive
way and limit the negative effects
of personal emotions, with regards
to the dispute. A mediator can
prevent time being wasted and an
unproductive meeting occurring, by
helping both parties to establish
their common ground and the
workable solutions they can adopt.
Mediation is a good form of
alternative dispute resolution if
flexibility is required, as the process
can be adapted to suit the needs of
the parties as well as the matter(s)
in dispute. It permits the parties to
meet separately, with the mediator
going back and forth between the
two parties in order to, amongst
other things, understand the wants
and needs of each party together
with the boundaries in which
settlement can be made; or to meet
in the same room with the mediator
there to facilitate discussion.
Before this process can start, the
mediator will likely require a brief
mediation statement from both
parties, as a starting point to the
discussions by understanding what
each party would like to achieve
from mediation. In some cases,
there is assistance from lawyers,
consultants and possibly experts.
More often than not, a mediation
involves a combination of the four
processes listed above to reach an
effective and agreeable solution.
One potential issue with mediation
which the parties must consider,
is that, whilst negotiation gives the
parties the freedom to construct
the discussion on their own terms,
this is not the same for mediation. In
this regard, the parties must agree
to the core element of mediation,
which gives the mediator the
freedom to help them arrive at an
agreed conclusion. One element
that aligns with negotiation is that
it is the parties, not the mediator,
who have the power to make a final
binding decision. Mediation further
assists this element, by ensuring
that both parties have in attendance
someone with the power, to make a
final binding decision. It is often the
case therefore, that the parties elect
to reach a contractual agreement to
bind themselves to the outcome of
the mediation, so that the efforts of
the mediator and the parties is not
lost through a subsequent change
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