UK Accounting Glossary
A nonbinding process in which a third party attempts to settle a problem between two other parties.
a negotiation to resolve differences that is conducted by some impartial party
Intervention in a dispute in order to resolve it; arbitration.
Mediation is a dynamic, structured, interactive process where an impartial third party assists disputing parties in resolving conflict through the use of specialized communication and negotiation techniques.
It is an informal, voluntary, and confidential form of conflict resolution which allows a third party to assist in resolving a legal conflict between two parties. It is often used in divorce and allows a settlement without going to trial.
In mediation, a trained mediator helps people in conflict discuss concerns and, when possible, decide a fair solution. The benefit of mediation is it allows for a mediator, who is a neutral person, to help parties discuss their conflicts. The mediator, however, does not decide who “wins” or “loses.”
Mediation allows for a third party to evaluate each party’s side, identify the issues, discuss the party’s needs and help each party talk about solutions. Mediation can be done together with each party or independently. The benefit of mediation is can save cost and time over going to trial. Some conflicts will require each party to attempt mediation prior to trial.
After the claim was denied, the CFO met in mediation with the representative of the insurance company to try to work out a solution.
Mediation is a less expensive option than litigation and is a good first step to try and settle a dispute.
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This glossary post was last updated: 15th February 2020.