New Jersey business owners like you need to have preparations for handling disputes. There are many methods to do this. Three primary ways are through arbitration, litigation and mediation.
Litigation is often the option you want to look at last. Mediation and arbitration both offer benefits that you may want.
Litigation, arbitration and mediation
FINRA hosts an overview explaining how arbitration and mediation differ. This covers how they differ from each other, as well as how they differ from litigation. First, litigation means you take your issue to court. This involves long hours and lots of money. Your dispute is public record, too. This means anyone can look it up. Not only that, but litigation can burn bridges. This is something all business owners want to avoid.
Mediation and arbitration both allow you to solve your issues outside of court. The roles of mediator and arbitrator are also similar. Arbitrators hand down a decision based on the information they gain during discussions. They look at the parties involved and at the information you present. They factor this into their decision.
How mediators and arbitrators differ
Mediators do not hand down a decision. They make suggestions based on what they hear from all parties. They voice their opinions when they feel it is necessary. They also work to calm down any party that may get agitated during the process. Tensions often run high when working out disputes. Mediators are great at keeping them from boiling over. They ensure everyone in the room gets to say their piece.
So which should you go with? This depends on what you want out of your discussion. Do you want someone to make a decision for you? Arbitration is your best bet. Do you want guidance while you work things out with other parties? Mediators are for you.