Legal update on conflict resolution: When is mediation your best option?

Bazul Ashhab, Managing Partner & Head of Dispute Resolution, Oon and Bazul LLP shares advice on how to resolve disputes between employers and employees amicably and privately.

Mediation is often understated as a dispute resolution tool and process.

However, if your company has an employment dispute, mediation can be used to ensure views are ventilated between employer and employee, which is conducive to parties reaching an amicable settlement. Let's find out what mediation is, the advantages of mediation, and three tips for when mediation is your best option.

What is mediation?

Mediation is a voluntary process where parties engage a neutral third party – a mediator, who facilitates negotiations to resolve parties’ disputes amicably and privately. The mediation can take place informally or formally through a mediation institution such as the Singapore International Mediation Centre and the Singapore Mediation Centre.

Advantages of mediation

There are three main advantages to mediating disputes. Firstly, it is speedy and cost-effective – it is significantly faster and cheaper compared to traditional dispute resolution processes like litigation and arbitration.

Secondly, it is a consensual approach to resolving disputes, as opposed to an ‘all or nothing’ approach in litigation and arbitration.

Thirdly, it strives to preserve cordial relations between parties. In addition to the above, another important feature of mediation that may sometimes be important to disputing parties is that it is a private and confidential process.

Three tips for when mediation is your best option

I. First port of call as a dispute resolution tool

Given the above advantages, mediation should in fact always be your first port of call in resolving disputes. This is especially so when the other party is open to mediating the matter, which helps avoid the hassle and costs incurred in litigating the dispute.

More importantly, given the current COVID-19 pandemic, many businesses are struggling to make ends meet. More than ever, time and money are such precious resources that can and should be used for more productive purposes to generate more profits for the business.

In this connection, mediating disputes substantially reduces the time and legal costs involved in reaching for an amicable solution.

II. Especially useful for resolving low-value disputes

Mediation is also especially useful for resolving relatively low-value disputes. It is not practical for disputing parties to have legal costs which are close to or exceed the value of claims – this may occur in relatively low-value disputes. In this connection, mediation becomes an asset in resolving your low-value disputes, without the exorbitant costs.

III. A viable dispute resolution option regardless of the strength of your case

Mediation should be considered as a dispute resolution tool regardless of the strength of your case. If you feel you have a strong case, mediating your dispute will likely save time and legal costs incurred compared to if you were to have to commence formal legal proceedings.

If you feel you have a weak case, mediating your dispute will allow both parties to ventilate their views in a concerted effort to discuss how the matter can be resolved.

Thus, regardless of the strength of your case, mediation brings advantages to the table.

In conclusion, given its advantages, mediation should be your first port of call as a dispute resolution process. This is particularly so given the economic downturn caused by the current COVID-19 pandemic.

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