How does arbitration differ from mediation in resolving collective bargaining disputes?

Arbitration is a process in which an impartial third party, known as an arbitrator, makes a decision to resolve a dispute based on the evidence and arguments presented by the parties involved. This decision is usually binding, meaning that both parties must adhere to the outcome agreed upon by the arbitrator. The binding nature of arbitration is a significant aspect that distinguishes it from mediation, where the mediator facilitates dialogue between the parties but does not impose a solution.

The binding characteristic of arbitration provides a clear resolution to the dispute, which can be essential in collective bargaining contexts where finality is needed to move forward. This is particularly important in labor relations where unresolved disputes may lead to work stoppages or ongoing tensions between employers and employees.

In contrast, mediation focuses on helping the parties reach a mutually acceptable agreement through negotiation and collaboration, and it does not involve a binding decision. While mediation may also involve a third party, as noted in other options, it is fundamentally different from arbitration due to the nature of the outcomes each process produces.