The role of mediation in employment law

Where does mediation sit in Australia’s complex workplace law framework?

The role of mediation in employment law

“There is no one law in Australia that says ‘thou shalt mediate’,” said Dr. Leigh Hodder, senior workplace relations adviser at iHR.

However, when done properly mediation is a legally binding alternate dispute resolution process that is well established within Australian courts and tribunals, and is supported by legislation. 

One example is the Family Law Act, where parties are encouraged to access mediation rather than go to court. 

The Fair Work and Human Rights Commission, the Federal Circuit Court/Federal Court, as well as all levels of State Courts and Tribunals, insist on attempts at settlement before the matter is heard.

In the NSW Supreme Court, for instance, the settlement rate is now 46% - and this is only for matters that were actually commenced in the court.

The figure is even more impressive when one extrapolates the number of matters that were settled before they got that far.

“Australian industrial relations legislation recognises the efficiency of mediation and conciliation, rather than proceeding to costly arbitration in the first instance,” says Hodder.

Indeed, in most circumstances a court or tribunal will be required to certify that mediation and conciliation is unlikely to resolve the matter before exercising its arbitrary powers. 

An example is section 576(2)(ca) of the Fair Work Act 2009 in relation to the powers of the  FWC which reads:

(ca)     mediating any proceedings, part of proceedings or matter arising out of any proceedings that, under section 53A of the Federal Court of Australia Act 1976 or section 34 of the Federal Circuit Court of Australia Act 1999, have been referred by the Fair Work Division of the Federal Court or Federal Circuit Court to the FWC for mediation.

Hodder said the mediation process itself is structured and quite simple, usually consisting of three stages. 


The first step is to prepare the parties to mediate – to set their expectations about possible outcomes at a realistic level, to start them thinking about the desired behaviours and identify the issues they wish to raise.

The mediator talks with HR about alternative outcomes should the mediation not result in agreement. The mediator meets with each party individually to understand the issues, provide further education about the process and assess the person’s capacity to participate in the mediation. The mediator synthesises this information and plans the session strategies.

The session

The second step is to conduct the mediation session. This, in Hodder’s experience, averages from 2–4 hours. The mediator follows these steps:

  • opening statement
  • venting
  • issue identification and agenda setting
  • issue discussion and agreement building
  • close session


The third step involves the mediator finalising the agreement and sending it through to the parties for signing and implementation. The mediator liaises with HR regarding the success of the mediation.

Having come through the process, participants will be keen to know how enforceable the outcomes are.

In terms of workplace behavioural agreements, the agreed-to behaviours should align with code of conduct expectations, so appropriate disciplinary action could and should be taken for breaches of the agreement.

“Breaches to the confidentiality of the process should also be subjected to disciplinary action,” said Hodder.

As a final tip, confidentiality is the cornerstone of the mediation process, and participants may be asked to sign a confidentiality agreement by the mediator.      



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