Mediation involves all parties speaking to each other as in negotiations. Again, the ultimate goal is negotiation to a common bottom line. However, the use of mediation involves a third party, a mediator. It is the mediator’s job to bring both parties closer to the same bottom line. The mediator’s job is not easy as he has to steer both parties without becoming personally involved. One party cannot back down from their demands without losing face with their bosses. The other party being either owners who have to face stockholders or councils, cannot surrender to the demands. The use of a third party mediator makes it easier because both parties can blame any changes on the mediator. However, the truth of the matter is that the mediator does not make any decisions, just channels the process.

The mediator has both a public and private position. (Public and private refer to their position within the negotiating realm, not the public media.) In the public position, both parties are present and openly negotiate back and forth with the mediator as a witness. The private position puts the mediator more in a shuttle diplomacy mode. He hears the argument of one side in a private meeting and then shuttles to the next private meeting to hear the other party present their position. A mediator can often be put into a position where information he hears from one party may be confidential by request. This material cannot be divulged to the other party without permission.

For the mediator to properly do his work, confidential information may be very helpful when the mediator meets in private with each party, his job is to listen and again to form a perception of each party, what their demands are versus their real needs. In order to do this, he may have several conversations that may include profit line or other factors that may tip the hand in negotiations if the other party is aware of the information. The mediator has a fiduciary duty to talk with both parties without divulging confidential material. The mediator should ask questions; questions that cause the parties to think; questions that cannot be answered with a yes or no. In order for this to work, the use of mediation should be a consensual agreement between both parties. The selection of the actual mediator should also be acceptable.

The private side of mediation is the major difference with negotiation. In both cases the negotiator is neutral but in private meetings he may push one side harder than the other.

Once the issue is resolved, the mediator should put any settlement in writing so that both parties sign and acknowledge their agreement with the settlement. The settlement agreement should focus on terms of the settlement only, not the negotiating process.

It is best to keep mediation as free as possible, with the only rules being confidentiality. The easiest thing for the mediator to do is to try and force an issue, but the best results from mediation would be if the parties came to the same solution without being forced. Cost for negotiation mediation is generally split but can also be mediated.