As a business owner, you try to provide your employees with a harmonious work environment, but disputes may still arise in the workplace.

Some workplace conflicts can be resolved quickly when your employees are encouraged to communicate with one another and use problem solving skills; however, there may come a time when a serious dispute arises that you are unable to resolve without assistance. In this case, you may need to turn to alternative dispute resolution.

Alternative dispute resolution, or ADR, refers to resolving disputes in ways other than going to court. Successful ADR processes should begin as soon as possible after the incident to ensure accuracy of events.

Three commonly used ADR methods are:

  • Negotiation
  • Mediation
  • Arbitration


Negotiation occurs when the individuals involved in the dispute meet to try to resolve the issue.

This is the least confrontational way of resolving disputes. You may choose to use lawyers to facilitate the process. Once a resolution has been reached, the details are written up and signed by the parties involved.


Mediation, which is the most frequently used form of ADR, involves an independent mediator that has no vested interest in your business. The mediator's job is to guide the proceedings to find a satisfactory solution for all concerned. The mediation process is confidential and may be terminated by you or any of the interested parties at any time.

Once a reasonable solution is achieved, it should be documented and notarized in a settlement agreement before becoming a binding agreement.


Arbitration is similar to mediation in that a neutral third party is involved. An arbitrator collects all the facts from both sides and comes up with a legally binding decision. There is no room for negotiation once the decision has been handed down.

Arbitrators are selected by you and have a thorough knowledge of business law.

Alternative dispute resolution techniques work well for serious workplace conflicts, but in many cases, these issues can be resolved before the matter becomes quite so serious.

For more information on preventing conflicts, please visit the Preventing and resolving workplace conflicts and Resolving conflict pages.

For more detailed information on employment standards and industrial relations, please refer to our section on employment standards.

Use our section on legal issues for small business to answer other questions you may have on this topic.