ADR in the Workplace: When to Use it and Why

ADR in the Workplace: When to Use it and Why

Alternative Dispute Resolution, or ADR, offers creative solutions to workplace grievances. Find out how to implement it in your workplace, when it is appropriate, and its benefits.

Alternative dispute resolution, or ADR for short, encompasses a variety of techniques designed to resolve conflicts without taking legal action.

Implementing ADR in the workplace doesn’t work for every conflict, but it is a favorable alternative to more traditional resolution methods, in many cases. Keep reading to learn more about the benefits of ADR and when you should use it.

Get some conflict resolution strategy ideas with our free cheat sheet.

What Are Some Examples of Alternative Dispute Resolution?

One major aim of ADR is to offer a less formal environment in which to resolve workplace disputes. Rather than going to court, parties work together with a neutral individual or panel to come to a decision together.

ADR comes in many forms, so it is important to consider the details of the grievance and what the parties want from the resolution when deciding which process would best suit them.

Examples of Alternative Dispute Resolution include:

  • Mediation: a mediator works with both parties to come up with a resolution. The mediator offers advice and solution ideas, but the ultimate decision is up to the parties.
  • Arbitration: an arbitrator hears from both parties and makes either a binding or non-binding resolution decision. Both parties must sign an agreement to abide by the arbitrator’s decision. Sometimes, a panel review is used instead of a single arbitrator.
  • Peer review: the parties take their grievance to a group of managers or employees, who then make a resolution decision.
  • Adjudication: both parties tell their side of the story by sending paper evidence (like letters, reports, or photos) to a neutral adjudicator who then makes a resolution decision for them.
  • Ombudsman: an investigator looks into grievances concerning an organization or government body that has handled a situation unjustly. Ombudsman services are offered free of charge.

Not every type of ADR works for every case. Some processes naturally lend themselves to certain types of grievances and party relationships. For instance, if the complainant wants to have a face-to-face conversation with the other party, mediation is the perfect choice.

If the complainant prefers a third party to make a resolution decision on their behalf, consider adjudication, arbitration, or hiring an ombudsman. If the conflict is between employees of a similar level, a peer review might work best.

alternative dispute resolution

Benefits of ADR

Unlike traditional methods of dispute resolution, ADR takes both parties into account and finds a “win-win” solution to the conflict. It offers practical, flexible, adaptable, and creative outcomes that would never have been reached in court.

The list of benefits to using ADR in the workplace is a mile long, including:

  • Less expensive with no legal fees to pay.
  • Less time-consuming, as getting a court date can take months or even years.
  • The expedited nature of the resolution is less disruptive to the lives of the parties and their families.
  • The parties have control over their own outcome.
  • Less formal, which is less intimidating to some people.
  • Decisions are tailored to the parties’ needs, focusing on a compromise rather than “win-lose.”
  • Less risk because parties can turn down suggestions or walk away from the process.
  • More durable, as people are more willing to stick to a decision they make themselves.
  • May result in less severe outcomes, like an apology letter rather than suspension without pay.
  • Keeps relationships intact by attempting to satisfy both parties.
  • Maintains the organization’s mission and goals, boosts morale, and keeps the work environment pleasant by dealing with the dispute constructively.

Check out this webinar to learn how to avoid workplace conflict by fostering a harmonious environment.

When to Use ADR (And When to Avoid It)

Using ADR in the workplace can help your organization avoid legal expenses, a drawn-out resolution process, and a tense work environment. However, Alternative Dispute Resolution is not appropriate for every situation.

If one party fears violence or intimidation, legal action should be taken right away. ADR may not be fast or binding enough to protect them. In fact, ADR cannot be used to decide if a law has been broken—it is only for resolving personal conflicts.

In cases of power imbalance, including sexual harassment and violence, or fraud, Alternative Dispute Resolution is not your best option.

Finally, for ADR to work, both parties must be willing to participate and stick with the resolution decision. Because ADR is not usually legally binding, both parties trust each other to come in with a good attitude and follow through on the agreement.

RELATED: Workplace Conflict Resolution: 10 Steps to Success

ADR: A Win-Win Solution

To save your organization thousands of dollars, months of time, and lots of stress, consider using ADR in the workplace. Alternative Dispute Resolution offers creative, “win-win” solutions to all sorts of disputes that work towards your workplace’s objectives.