Alternative Dispute Resolution (ADR) is the procedure for settling disputes without litigation, such as arbitration, mediation, or negotiation. ADR procedures are usually less costly and more expeditious. They are increasingly being utilized in disputes that would otherwise result in litigation, including high-profile labor disputes, divorce actions, and personal injury claims.

One of the primary reasons parties may prefer ADR proceedings is that, unlike adversarial litigation, ADR procedures are often collaborative and allow the parties to understand each other's positions. ADR also allows the parties to come up with more creative solutions that a court may not be legally allowed to impose.

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.