What is alternative dispute resolution, and why should you have it?
Alternative dispute resolution (ADR) allows you to resolve customer disputes fairly without going through a legal process. The Motor Ombudsman is the leading dispute resolution provider in the automotive industry.
This guide looks at how ADR works and how it can benefit your business.
What is alternative dispute resolution?
ADR is a way of fairly resolving disputes between a customer and a business. You don’t have to navigate any legal processes, which usually makes it much cheaper, quicker and more straightforward than going to court. ADR can be done using a neutral third-party mediator or a formal arbitration process.
How does alternative dispute resolution work?
The Motor Ombudsman uses a process of adjudication. This involves an impartial adjudicator reaching a decision (in favour of the business, consumer, or a split outcome) by evaluating evidence from both parties against the standards set by the organisation’s Code of Practice and, sometimes, the law.
The Ombudsman aims to resolve disputes as quickly and amicably as possible, so it will first try to resolve the issue without involving an adjudicator. When this happens, it’s known as early resolution. It could involve the business making an offer to settle the dispute or carrying out actions such as repairing the vehicle.
Do I have to use alternative dispute resolution?
The Alternative Dispute Resolution Regulations 2015 state that businesses must supply consumers with the details of a certified ADR provider and state whether they intend to use them to help resolve a dispute.
You don’t have to use ADR, but you must provide the relevant information to a consumer.
The benefits of alternative dispute resolution
We strongly recommend signing up to be part of an ADR body like the Motor Ombudsman. It demonstrates to your customers that you are committed to acting fairly and transparently.
There are many benefits, such as:
- Increased trust from customers
- Boosts your reputation
- Avoids the need for legal representation
- Usually completed privately and with confidentiality
- Fully impartial process
- Faster than court proceedings
- Flexible outcomes to achieve the best result for both parties
- Provides peace of mind in the event of a difficult dispute
- Saves time and reduces costs
Learn more about alternative dispute resolution
The Motor Ombudsman offers a free training module that covers what ADR is and how it works. The module takes around 40 minutes. Participants are eligible for Continuing Professional Development (CPD) points and will receive a certificate on completion of the course.
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