When a third party holds an informal meeting with both sides in a dispute to promote resolution of a grievance, a compromise, or a settlement of a lawsuit. The result of the mediation, if any, is not binding on the parties. A mediator can be court-appointed or chosen by the parties.
When a third party holds a formal meeting with both sides in a dispute to promote resolution of a grievance, a compromise, or a settlement of a lawsuit. The result of the arbitration may be binding on the parties. An arbitrator is usually court-appointed or chosen by the parties. Some union collective bargaining agreements require mandatory arbitration of employment grievances.