From October 1 2015, all businesses in the UK will have to display in their terms and conditions and website a complaints procedure which includes the identity of a neutral or ombudsman or Alternative Dispute Provider (ADR). The law does not compel a business to use ADR but does require them to inform the consumer of their enhanced consumer rights.
Mediating a resolution to an escalated customer complaint has overwhelming advantages over going to the small claims court:
- Mediation fees are cheaper than overall costs of going to court; technology makes ADR fast.
- There is no risk to the outcome of a judgement, as the settlement is in the hands of the disputees.
- It is confidential, no public records are made.
- Mediation does not extinguish rights to pursue an action in the courts.
- A settlement by mediation is the most successful dispute recovery route to win back customer loyalty and support brand integrity.
EU ODR Platform
If consumers have a complaint about a good or service they have bought, instead of going to court, they can choose Alternative Dispute Resolution (ADR). The term ADR includes all the ways of resolving a complaint which do not involve going to court.
Typically consumers ask a neutral third party to act as an intermediary between them and the trader; this neutral third party is called an ADR entity. The ADR entity can then suggest or impose a solution, or simply bring the two together to discuss how to find a solution. This is also known as “mediation”, “conciliation”, “arbitration”, “ombudsman” or “complaints’ board”. Compared with going to court, ADR is usually quicker, simpler and costs less.
Online Dispute Resolution (ODR) is an ADR procedure conducted entirely online. The new EU ODR platform is developed and operated by the European Commission. In accordance with the relevant legislation, the Commission prepared the platform by the deadline of 9 January 2016.
It is available for use as of 15 February 2016 to allow for a maximum geographical and sectoral coverage across the European Union as Member States had first to assess and notify to the Commission the national ADR entities.