The HR Dictionary

Alternative Dispute Resolution (ADR)

Alternative dispute resolution (ADR) refers to the different ways people can resolve disputes without a trial. Common ADR processes include mediation, arbitration, and neutral evaluation. These processes are generally confidential, less formal, and less stressful than traditional court proceedings.

ADR has historically faced opposition from many powerful parties and their supporters, but in recent years, both the general public and the legal community have come to embrace it widely. In fact, before allowing the parties' cases to go to trial, some courts now require some parties to use ADR of some kind, such as mediation. In fact, the European Mediation Directive of 2008 expressly anticipates compulsory mediation. It does not imply that a settlement must be obtained through mediation; rather, attendance is required. In addition, parties of mergers and acquisitions transactions are increasingly using ADR to settle disagreements after the transaction.

The rising caseload of traditional courts, the belief that ADR incurs lower costs than litigation, a preference for confidentiality, and the desire of some parties to have more control over the choice of the person or persons who will decide their dispute are all contributing factors to the rising popularity of ADR. Thus, ADR can be actively used within organizations to resolve disputes that arise between various parties due to differences in opinions, culture, attitude, etc. before it reaches the stages of formal complaints being made. The HR department will play a crucial role in conducting alternative dispute resolution activities as an independent and trusted third party. With the help of HR software that facilitates discipline tracking and the management of disciplinary actions along with the required course of action to resolve them, HR Managers can make sure to effectively handle multiple disputes at the same time with ease.