There are many different ADR types that may involve third party’s help and that may be binding as well as non-binding. The two most common types of ADR are mediation and arbitration; however, each has its own variations, too.

1. Mediation involves the help of a go-between third party, called a "mediator," whose job is to help parties reach some mutual agreement. A mediator cannot force parties to agree and is not even permitted decide the outcome of a dispute. Therefore, while mediating, both parties retain significant control over the course of mediation. Mediation is fully confidential and agreemtns are usually non-binding, so parties may still pursue litigation following the mediation process.

2. Arbitration also involves the help of a neutral third party. During arbitration, an "arbitrator" acts a bit analogously to a trial judge by listening to the parties’ grievances. Unlike a mediator, an arbitrator is not a passive go-between facilitator. After listening to the parties, an arbitrator (often a professional in the party’s subject of dispute) actually pronounces a decision. Arbitration is still less formal than a full-blown trial because many rules of evidence don’t apply to arbitration.